Titles to two Newstead apartments issued about six weeks before the sunset date in an off-the-plan contract signed in 2017. Some three and a half months after that date, the developer ended the contract under its sunset clause and later resold both lots. The Chief Justice held it had no right to do so, valued the lots at more than twice the contract price, and gave the buyer judgment for about $6.1 million. In CAV Gasworks Pty Ltd v JYP Jiang Pty Ltd [2026] QCA 221 the Queensland Court of Appeal, by majority, allowed the developer’s appeal and dismissed the buyer’s claim, save for a declaration made below.
The decision turns on one word in one contract. Whether the seller “cannot” give a settlement notice under this contract, two judges held, is not a question of strict impossibility. But the two judges in the majority reached that result by different routes, one of them called the question “finely balanced”, and Bradley JA dissented. What the case settles, and what it does not, needs care.
The contract and what happened
The buyer agreed on 30 June 2017 to buy two proposed lots in a community titles scheme at Newstead for $4.2 million and paid a $420,000 deposit, at [8] and [9]. Clause 8.1 required the seller to give written notice after it became aware that the plan and community management statement had registered, the scheme had been established and separate titles created. Its second sentence then said that the seller “need not give the notice under this clause until the Seller is satisfied that all obligations required to be performed by the Seller under this contract or at law on or before on or before [sic] settlement will be completed within 14 days of the notice given to the Buyer”, at [12]. The completion date ran from that notice, at [14].
Clause 8.3 was the sunset clause: “If the Seller cannot give the Buyer such notice within 5.5 years after the Contract Date (or by any extended date as referred to in sub-clause 8.4) then the Buyer or the Seller may end the Contract”, with the deposit refunded, at [12].
The scheme was established on or about 28 October 2022 and separate titles issued on or about 14 November 2022. By 8 December 2022 the seller had settled two other lots created the same way. The sunset date was 30 December 2022, and it was not disputed that the seller knew before then that the title steps were complete, at [26] to [28]. On 13 April 2023 the seller gave notice ending the contract under cl 8.3. Its director said he instructed that termination because a certificate of occupancy had not issued for the lots, at [32]. The buyer affirmed, the seller resold both lots, and the buyer then accepted that conduct as repudiation and sued, at [1].
Bowskill CJ read “cannot give” as meaning an impossibility of giving the notice, at [16](e). Once the title steps were done before the sunset date, the cl 8.3 right was gone, the April 2023 notice was ineffective, and the buyer recovered the difference between a market value of $10.3 million and the $4.2 million price, with interest, at [2].
What the Court decided
| Question | Raised by | What the Court held | Effect on the appeal |
|---|---|---|---|
| Ground 1. Did the seller validly end the contract under cl 8.3? | Seller, notice of appeal | Yes, by majority. Crow J at [62] and Hindman J at [116], for different reasons. Bradley JA dissented at [18] to [29] | Decided the appeal |
| Ground 2. Could the seller end the contract under cl 13.1(c) after the sunset date? | Seller, notice of appeal | Not decided by the Court. Crow J and Hindman J said, without needing to, that it operates only before the sunset period ends, at [63], [64] and [117]. Bradley JA rejected it in his dissent, at [35] to [37] | None. The views of Crow J and Hindman J are considered obiter |
| Was the director’s cl 13.1(c) opinion unreasonable? | Buyer, notice of contention | Not separately decided by the majority, at [33] | None |
| Orders | Buyer’s claim dismissed save for a declaration made below; buyer to pay the seller’s costs of the claim and the appeal on the standard basis, at [118] | Judgment below set aside |
The dissent: once titles issue, the sunset right is spent
Bradley JA would have upheld the Chief Justice. On his Honour’s reading, the notice in cl 8.3 is the notice in the first sentence of cl 8.1, and the second sentence only lets the seller delay a notice it is otherwise able to give. That gave the clause a clear commercial purpose. It gave both parties certainty that “once the separate title requirements are met, neither party can terminate the contract under cl 8.3”, at [22]. Had the parties meant “need not”, they could have used those words, as they did in cl 8.1, at [24]. And the seller’s reading “would tend to render the seller’s performance optional (or voluntary)”, at [25], in a contract that already gave the seller many express rights to end it.
Crow J: the notice is a readiness-to-settle notice
Crow J began with what the seller had to deliver at completion. Clause 7.4 obliged it to give vacant possession of “the lot”, and read with the disclosure documents that meant “a fully completed lot as contracted for, with all of the items referred to in the schedule of finishes”, at [47]. A certificate of occupancy under the Building Act 1975 (Qld) can issue well before the finishes are in, at [54].
On that footing, the cl 8 notice is a single settlement notice which must be given, but only when the seller is in a position to perform. The word “cannot” in cl 8.3 is to be read as “cannot because the seller is unable to meet its obligations in clause 7.4”, at [60]. The notice is to be given “when the seller is ready to settle, and not before the seller, acting reasonably and honestly, is ready to settle”, also at [60]. Any other reading would oblige a seller to trigger settlement on an incomplete unit. His Honour said that “on the facts it was plain that the seller could not give such notice within the sunset date”, so the cl 8.3 right was enlivened and the termination was lawful, at [62].
Hindman J: a condition precedent, an implied term, and a practical meaning
Hindman J agreed in the result “for different reasons”, at [66], and began by saying the construction issue “is finely balanced”, at [67]. Her Honour’s analysis has three steps.
First, cl 8.1. A party cannot at once be obliged to give a notice and “need not” give it. The second sentence is therefore “in a way, a condition precedent to the obligation to give a notice arising”, at [82], rather than a right to delay an obligation already owed. That reading requires an implied term that the seller “must act honestly, reasonably and without hindering the fulfilment of the purpose of the express conditions”, at [80], citing Meehan v Jones (1982) 149 CLR 571.
Second, “cannot”. There is no fixed ordinary meaning: “Absent authority to the contrary, I would not conclude there is an ‘ordinary’ meaning of the word ‘cannot'”, at [73]. Read commercially, the word imports “some kind of actual, practical ability to do something beyond a mere bare ability or physical possibility regardless of the consequences”, at [108]. No reasonable businessperson would think they “can” give a notice that triggers settlement within 14 days when they could not complete in that time, at [109].
Third, purpose. Her Honour accepted the seller’s argument linking cl 8 to settlement and to the buyer’s statutory sunset right in s 217B of the Body Corporate and Community Management Act 1997 (Qld), at [100], and held that cl 8 was concerned with construction and completion, not only title, at [105]. A certificate of classification issuing does not mean the second sentence of cl 8.1 is satisfied, at [112].
The seller’s discretion is not unbounded. The obligation “does not arise until the seller, acting reasonably, is satisfied that it will be able to complete all its contractual obligations within 14 days of issuing the notice”, at [115].
The second ground
The seller also relied on cl 13.1(c), which let it terminate if “at any time” it formed the opinion that cl 8.3 “will apply”. The Court did not decide that ground, because the appeal succeeded on ground 1, but none of the three judges would have accepted it. Bradley JA, as part of his dissenting reasons, held that once the title steps were done the seller could not logically form the view that they would not be met, and that cl 13.1 “does not give the seller a unilateral power to determine the meaning of cl 8.3”, at [35] and [36]. Crow J and Hindman J read the clause as operating only prospectively, before the sunset period ends, at [63], [64] and [117]. Hindman J said expressly that it was unnecessary to consider ground 2, at [117]. Those views of the two majority judges were not necessary to the result and are considered obiter.
What it changes for practitioners
The decision is a construction of one developer’s contract, by two judges for different reasons. It does not hold that a seller may end an off-the-plan contract whenever it is not ready to settle, or that “cannot” in another sunset clause carries a practical meaning. It does show that a sunset clause tied to a notice which the seller “need not” give until satisfied it can perform may leave the seller’s exit open after titles issue, subject to the seller acting honestly and reasonably.
For buyers’ representatives, that points to the drafting. Where the sunset trigger is a notice the seller controls, it is worth asking for the trigger to be an objective event such as registration of the plan or issue of title, or for an express statement that the seller’s right to end the contract under the clause ceases once that event occurs. Where the seller’s satisfaction governs when the notice is given, the buyer’s protection is the requirement that the seller act honestly and reasonably. Both majority judges imposed it, by different routes: Crow J as part of his construction of cl 8.1, at [56] and [60], and Hindman J as an implied term, at [80] and [115]. Evidence of the state of the building at the sunset date is likely to matter.
The Land Sales Act 1984 (Qld) now provides that a seller of a proposed lot may terminate an off-the-plan contract under a sunset clause only with the buyer’s written consent after notice, under a Supreme Court order, or in a prescribed way: s 19D. That Act’s definition of “proposed lot” in sch 1 excludes a proposed lot to which the Body Corporate and Community Management Act 1997 (Qld) applies. The Court did not refer to that regime. For an apartment or townhouse in a community titles scheme, the s 19D consent requirement does not apply, and a dispute like this one is fought over the text of the contract, read alongside the buyer’s right in s 217B.
Published 2 November 2026.
What remains unsettled
With no single majority line of reasoning, it is not clear which of the two approaches a later court should follow, and the Chief Justice’s reading attracted the support of Bradley JA. The majority did not decide the buyer’s contention that the director’s opinion under cl 13.1(c) was unreasonable, at [33]. One subsidiary point is not open: Hindman J held there is a single cl 8 notice, so no choice between separate cl 8.1 and cl 8.2 notices arose, at [84] and [91], and Crow J also read cl 8 as contemplating one notice, at [49]. Hindman J said the consequences of the contract allowing a six-month extension beyond the 5.5 years in s 217B were “not relevant for present purposes”, at footnote 38. Neither majority judge set out how long a seller may defer a satisfaction-based notice before it fails to act honestly and reasonably. The appeal was from JYP Jiang Pty Ltd v CAV Gasworks Pty Ltd [2025] QSC 134. The reasons are on AustLII.
Related reading
- Conveyancing services
- Sunset clauses in Queensland off-the-plan contracts
- Off-the-plan contract review: the clauses to check
- Property disputes
Buying or selling off the plan? How a sunset clause is drafted can decide who carries a rising or falling market. Contact Fraser Lawyers to have the contract reviewed before you sign. |
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