Welcome to today’s Chamberlains Selection, where we will discuss with James d’Apice on the matter of Jafari v 23 Developments [2019] VSCA 201. We will talk about a company partnership facing a property discrepancy.

A claimed to own property and was in financial trouble. It agreed with R that A would sell the properties to R and A would help develop them and share profits. [3], [4], [143] This arrangement fell apart because A didn’t own the properties. [6] R did buy the properties from the mortgagee in possession and – speaking broadly – discussions progressed further on the basis A would still play a role. [8], [43] The parties couldn’t agree on how to proceed and relations broke down. [9], [49] A claimed to be in partnership with R, and that R breached its partnership duties to the tune of $6M. [13], [143] A said that, among other things, the “general tenor” of the agreement and the profit share element meant it was a partnership agreement. [146] The Court disagreed. There was no express term that R would own the properties on behalf of the partners, or provision of liability of one partner for a co-partner’s dealings; references to “the project” were not indicia of partnership; and references to “partners” in early drafts of the document had been removed in the final version. [164 – 170]