Advisory Services Pty Ltd v Augustin
[2017] VCC 702
•2 June 2017
| IN THE COUNTY COURT OF VICTORIA AT MELBOURNE COMMERCIAL DIVISION | Revised Not Restricted Suitable for Publication |
Case No. CI-16-03200
| Advisory Services Pty Ltd | Plaintiff |
| v | |
| Augustin & Ors | Defendant |
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JUDGE: | Judicial Registrar Tran | |
WHERE HELD: | Melbourne | |
DATE OF HEARING: | 31 May 2017 | |
DATE OF DECISION: | 2 June 2017 | |
CASE MAY BE CITED AS: | Advisory Services Pty Ltd v Augustin & Ors | |
MEDIUM NEUTRAL CITATION: | [2017] VCC 702 | |
REASONS FOR DECISION
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APPEARANCES: | Counsel | Solicitors |
| For the Plaintiff | M. Ravech of Counsel | |
| For the Defendant | I. Upjohn QC W. Rimmer of Counsel |
JUDICIAL REGISTRAR:
1 This proceeding is set down for trial on 7 June 2017. By summons filed 22 May 2017, the Defendants sought summary judgment. Due to the 14 day service requirement in Rule 22.18(4), the summons was listed for hearing by the duty judge on 6 June 2017, the eve of trial. The parties agreed that this was not a sensible date for the hearing of the summons in the circumstances, although they initially disagreed as to the appropriate date for the summons to be heard. At a directions hearing on 31 May 2017, the parties consented to orders that the summary judgment application be heard by me that afternoon, with an abridgment of the time for service.
2 The Plaintiff is a real estate agent suing for commission pursuant to an exclusive sale authority dated 12 October 2015 (“the Authority”). The Defendants raise a number of defences. One of these is that the Authority did not contain a rebate statement that complies with s.49A(4) of the Estate Agents Act 1980 (Vic) (“the Act”) and that the Plaintiff is therefore not entitled to sue for or recover the amounts claimed by reason of s.50 of the Act (“the Rebate Statement Defence”). It is on the basis of the Rebate Statement Defence that the Defendants seek summary judgment.
3 Section 63 of the Civil Procedure Act 2010 (Vic) (“the CPA”) provides that the Court may give summary judgment “if satisfied that a claim…has no real prospects of success”. Section 64 provides that a court:
“may order that a civil proceeding proceed to trial if the court is satisfied that, despite there being no real prospects of success, the civil proceeding should not be disposed of summarily because –
a) it is not in the interests of justice to do so; or
b) the dispute is of such a nature that only a full hearing on the merits is appropriate.”
4 I have concluded that the application for summary judgment ought be dismissed either pursuant to the discretion inherent in s.63 of the CPA or pursuant to s.64,[1] as the circumstances are such that it would be in the interests of justice in all the circumstances for this matter to proceed to trial.
[1] See Cross Country Realty Victoria Pty Ltd v Ubertas 350 William Street Pty Ltd [2015] VSCA 347 at [76]
The Rebate Statement Defence
5 Sub-Section 50(1) of the Act provides that:
“an estate agent is not entitled to sue for or recover or retain any commission or money in respect of any outgoings for or in respect of any transaction unless…(b) the agent has complied with section 49A(1) with respect to the engagement or appointment to undertake the transaction…”
6 Sub-Section 49A(1) of the Act provides that:
“An estate agent must not obtain, or seek to obtain, any payment from a person in respect of work done by, or on behalf of, the agent or in respect of any outgoings incurred by the agent unless – (a) the agent holds a written engagement or appointment that is signed by the person (or person’s representative; and….(c) the engagement or appointment contains – (iii) a rebate statement that complies with subsection (4).”
7 Sub-Section 49A(4) of the Act provides that “A rebate statement complies with this subsection if it is in a form approved by the Director and it contains -
(a) a statement of whether or not the agent will be, or is likely to be, entitled to any rebate in respect of –
(i) any outgoings; or
(ii) any prepayments made by the person engaging or appointing the agent (the client) in respect of any intended expenditure by the agent on the client’s behalf; or
(iii) any payments made by the client to another person in respect of the work; and
(b) if such an entitlement will, or is likely to, occur, details of –
(i) the goods or services to which the rebate relates; and
(ii) the name of the person providing the rebate; and
(iii) the amount of the rebate that will be attributable to the engagement or appointment, or if that amount is not known at the time the statement is made, an estimate (in dollars) of the amount; and
(c) a statement that the agent is not entitled to retain any rebate and must not charge the client an amount for any expenses that is more than the cost of those expenses; and
(d) any other statements or details required by the regulations.”
8 The Authority contained the following Rebate Statement:
“Item 6: Rebate Statement – No Rebate will be received
The Agent will not be, or is not likely to be, entitled to any rebate. A rebate includes any discount, commission, or other benefit, and includes non-monetary benefits.
(*If entitled to a rebate, complete and attach the rebate statement approved by the Director of Consumer Affairs Victoria, at the time of signing this Authority. The statement can be downloaded at Rebate Statement in the Authority does not appear to contain “a statement that the agent is not entitled to retain any rebate and must not charge the client an amount for any expenses that is more than the cost of those expenses” as required by sub-s.49A(4)(c).
10 It is contended by the Defendants that sub-s.49A(1) has not been complied with and therefore sub-s.50(1) prevents the Plaintiff from suing for the commission claimed in the present proceeding.
The Plaintiff’s arguments
11 The Plaintiff submitted that its claim nevertheless had a real prospect of success because:
a) There was no requirement to include the statement in sub-s.49A(4)(c) if no rebate will be received or is likely to be received;
b) The form used was a form approved by the Director in circumstances where no rebate will be received;
c) The Authority stated that the only amount payable was commission, so there is no amount from which the Plaintiff could have received or would receive any rebate. The additional words in sub-s.49A(4)(c) would be redundant in those circumstances;
d) The Authority was also in a form issued by the Real Estate Institute of Victoria. The impact of a finding that it did not comply with sub-s.49A(1) would be that many authorities issued by estate agents using this form would be defective.
12 The Plaintiff faces substantial obstacles to success in these arguments. If it were the statutory intention that sub-s.49A(4)(c) only apply if a rebate will be or is likely to be received, it could have been incorporated as an additional sub-para (iv) to s.49A(4)(b). The fact that it was not strongly indicates a legislative intention that the statement be required even if a rebate will not or is not likely to be received.
13 When pressed as to the legal relevance of the Director approving a particular form to the question of compliance with sub-s.49A(4)(c), no clear answer was able to be provided by Plaintiff’s Counsel. On its face, s.49A(4) appears to require both use of an approved form and satisfaction of the requirements in each applicable sub-paragraph (a)-(d).
14 As to the “redundancy” of the statement in s.49A(4)(c), again it was not clearly articulated as to why this would relieve an estate agent from the obligation to make a statement required under a statute, particularly one which it was agreed had as an underlying policy consumer protection.
15 The Plaintiff’s submissions must be understood, however, in the context of the very short notice given of this application for summary judgment.
16 Very little emphasis was given in the brief submissions made before me on the question whether, as a matter of statutory interpretation, substantial compliance with s.49A (4)(c) might suffice, and if so, whether the rebate statement in question constituted substantial compliance. There is a line of authorities commencing with Equipment Investments Pty Ltd v M J Dowthwaite & Co Pty Ltd (1968) 16 FLR 23 on this issue. None of these authorities were referred to.
17 The defendants relied heavily on the decision of Justice Cameron in Oliver Hume (Australia) Pty Ltd v Land Source Australia Pty Ltd [2015] VSC 77. In paragraphs [38] and [48] of her reasons, Justice Cameron refers to the requirements in s.49A(4)(c) as being “strict”. However, these passages were obiter comments made in the course of an interlocutory decision. Further, Justice Cameron may have been referring to the strictness with which the relevant provisions are applied so as to exclude any payment to an estate agent (whether pursuant to a contract, quantum meruit or otherwise) rather than a requirement to strictly and precisely comply with each paragraph of s.49A(4)(c).
18 There was also no submissions made on the fact that these provisions amounted to a significant curtailment of the common law rights of estate agents.
19 In the circumstances, there is merit in the Plaintiff’s final argument in opposition to summary judgment, that the impact of a finding that it did not comply with s.49A(1) would be that many authorities issued by estate agents using this form would be defective. The Authority appears to have been in a form issued by the REIV which incorporated a form approved by the Director of Consumer Affairs Victoria. If the defendants are correct those forms do not comply with the requirements of s.49A of the Act. The provisions of the Act in question have been in force since 2003. Section 50 also prohibits an estate agent retaining any commission or money in respect of any outgoings. A finding that the Plaintiff has no real prospect of success by reason of the Rebate Statement Defence has the potential to have serious implications for estate agents in Victoria over a prolonged period of time. Such a finding should not be made without very careful consideration and with the benefit of detailed submissions on all relevant authorities and principles. The trial fixed for 7 June 2017 provides an opportunity for that careful consideration, albeit in conjunction with the determination of the other matters in dispute between the parties.
20 This argument is strengthened by the defendants’ unexplained delay in bringing this application for summary judgment until the eve of trial. It was agreed by the parties that if I grant summary judgment any application for review from my decision should be heard by the trial judge and the parties should remain ready to proceed to trial on 7 June 2017. There is therefore little utility to be gained by the parties if I were to grant summary judgment and significant prejudice to be suffered both by the plaintiff and potentially by many other estate agents by an overly hasty decision.
21 The application for summary judgment should be dismissed and the proceeding should proceed to trial on 7 June 2017.
22 The REIV and the Director should be given an opportunity to consider whether they should seek leave to intervene or act as amicus curiae on this issue. I direct that the Plaintiff, by 4.30pm on Friday 2 June 2017 send a copy of these reasons to the REIV and the Director by email with the subject “Urgent message re: court proceedings on 7 June 2017 sent by direction of Judicial Registrar Tran of the County Court.”
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