Banks v Copas Newnham P/L - [2001] QDC 261

DISTRICT COURT OF QUEENSLAND

CITATION: Banks & Ors v Copas Newnham P/L & Ors [2001] QDC 261

PARTIES: RODNEY ROY BANKS AND
JEANETTE ELLEN BANKS  Plaintiffs
v
COPAS NEWNHAM PTY LTD
ACN 009 893 172  First Defendant
and
GRAHAM NEWNHAM  Second Defendant
and
WONDERLEY AND HALL (A FIRM)     Third Defendant

FILE NO/S: 3792 of 2000

DIVISION: Civil

PROCEEDING: Claim

ORIGINATING COURT: Brisbane

DELIVERED ON: 26 September 2001

DELIVERED AT: Brisbane

HEARING DATES: 29-31August, 3 September 2001

JUDGE: Judge Robin QC

ORDER: Plaintiff awarded $50,356 damages against all defendants Defendants adjudged liable to contribute equally

CATCHWORDS:
(Cth) Trade Practices Act 1974 s.51A, s.52, s.75B, s.82 – real estate agent liable in damages to purchaser of a home unit “off the plan” – references to guaranteed net rental return misleading and deceptive – no reasonable grounds to make them – there was no third party guarantee and the lessee appeared to be a company without resources - lessee only paid single instalment of rent – meaning of ‘guarantee’ considered – principal of real estate company held under accessorial liability – neither exonerated by purchaser’s seeking legal advice before signing contract – liability not avoided by agent’s disclaimer - contribution proceedings against purchaser’s solicitor.

Solicitor and client – solicitor retained with a view to attending to conveyancing under a contract yet to be signed but produced to the solicitor – duty of solicitor to advise that as subject property was to be encumbered by a long term lease, that the lessee’s capacity to pay rent should be investigated – contribution proceedings against vendor’s real estate agent.

(Cth) Trade Practices Act 1974
Fair Trading Act 1989

Butcher v Harkins (2001) NSWSC 15 (2 May 2001)
Heiseler v Anglo-Dal Ltd [1954] 2 All ER 770
B.W. Bowler & Anor v Hilda Pty Ltd [1996] 928 FAC 1, (1998) 210 FCA, (1998) 80 FCR 191, (2000) FCA 899, (2001) FCA 342
H W Thompson Building Pty Ltd v Allen Properties Services Pty Ltd (1983) 48 ALR 667
Fox v Everingham (1983) 50 ALR 337
Twiddle v Bradley (1990) 2 Qd R 464
Hanflex Pty Ltd v. NS Hope & Associates (1990) 2 Qd R 218
Gardam v George Wills & Co Ltd (1988) 82 ALR 415
Burg Design Pty Ltd v Wolki [1999] FCA 388
Landel Pty Ltd v Redland Shire Council and Lipoma Pty Ltd (2001) QCA 120
Argy v Blunts & Lane Cove Real Estate Pty Ltd (1990) 94 ALR 719
Menmel Pty Ltd v The Great Australian Bite Pty Ltd (1997) ATPR 41-553
Re La Rosa; ex parte Norgard v Rodpat Nominees Pty Ltd (1991) 104 ALR 237
Trade Practices Commission v Manfel Pty Ltd(In Liquidation) (1991) 105 ALR 520
Burke v LFOT Pty Ltd (2000) ATPR 41-781

COUNSEL: Mr A. Maher for the plaintiff
Mr Hassett for the first and second defendants
Mr D.G. Clothier for the third defendant

SOLICITORS:
Quinn & Scattini for the plaintiff
David Prince & Associates for the first and second defendants
Brian…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

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Details

Case: [2001] QDC 261
Decision Date: 26 September 2001

CaseChat Overview and Summary

In the Federal Court of Australia, Banks, the plaintiff, sued Copas Newnham P/L, an agent for the vendor, the vendor, the purchaser, and the purchaser’s solicitor. The dispute arose from the plaintiff's purchase of a home unit "off the plan" where the real estate agent allegedly made misleading and deceptive representations regarding the guaranteed net rental return. The plaintiff claimed that these representations had no reasonable grounds as there was no third-party guarantee and the lessee seemed to be a company without resources. The lessee had only paid a single instalment of rent.

The court was required to decide whether the real estate agent was liable for damages under the Trade Practices Act 1974 and if the agent's disclaimer could avoid liability. The court also needed to consider whether the purchaser's solicitor had a duty to advise on the lessee's capacity to pay rent and if the purchaser's seeking legal advice before signing the contract could exonerate the principal of the real estate company from liability. Furthermore, the court had to determine if contribution proceedings could be pursued against the purchaser’s solicitor.

The court found that the real estate agent was liable for misleading and deceptive conduct under the Trade Practices Act 1974, as the representations about the guaranteed net rental return were false and misleading. The court held that the agent's disclaimer did not avoid liability, and the principal of the real estate company was held under accessorial liability. The court also ruled that the purchaser's seeking legal advice did not exonerate the real estate agent from liability. Additionally, the court found that the purchaser's solicitor had a duty to advise on the lessee's capacity to pay rent, and contribution proceedings could be pursued against the purchaser’s solicitor. The court awarded the plaintiff $50,356 in damages against all defendants and adjudged them liable to contribute equally.

Orders

Orders of the court

Plaintiff awarded $50,356 damages against all defendants Defendants adjudged liable to contribute equally

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Banks & Ors v Copas Newnham P/L & Ors [2001] QDC 261
PARTIES:	RODNEY ROY BANKS AND JEANETTE ELLEN BANKS Plaintiffs v COPAS NEWNHAM PTY LTD ACN 009 893 172 First Defendant and GRAHAM NEWNHAM Second Defendant and WONDERLEY AND HALL (A FIRM) Third Defendant
FILE NO/S:	3792 of 2000
DIVISION:	Civil
PROCEEDING:	Claim
ORIGINATING COURT:	Brisbane
DELIVERED ON:	26 September 2001
DELIVERED AT:	Brisbane
HEARING DATES:	29-31August, 3 September 2001
JUDGE:	Judge Robin QC
ORDER:	Plaintiff awarded $50,356 damages against all defendants Defendants adjudged liable to contribute equally
CATCHWORDS:	(Cth) Trade Practices Act 1974 s.51A, s.52, s.75B, s.82 – real estate agent liable in damages to purchaser of a home unit “off the plan” – references to guaranteed net rental return misleading and deceptive – no reasonable grounds to make them – there was no third party guarantee and the lessee appeared to be a company without resources - lessee only paid single instalment of rent – meaning of ‘guarantee’ considered – principal of real estate company held under accessorial liability – neither exonerated by purchaser’s seeking legal advice before signing contract – liability not avoided by agent’s disclaimer - contribution proceedings against purchaser’s solicitor. Solicitor and client – solicitor retained with a view to attending to conveyancing under a contract yet to be signed but produced to the solicitor – duty of solicitor to advise that as subject property was to be encumbered by a long term lease, that the lessee’s capacity to pay rent should be investigated – contribution proceedings against vendor’s real estate agent. (Cth) Trade Practices Act 1974 Fair Trading Act 1989 Butcher v Harkins (2001) NSWSC 15 (2 May 2001) Heiseler v Anglo-Dal Ltd [1954] 2 All ER 770 B.W. Bowler & Anor v Hilda Pty Ltd [1996] 928 FAC 1, (1998) 210 FCA, (1998) 80 FCR 191, (2000) FCA 899, (2001) FCA 342 H W Thompson Building Pty Ltd v Allen Properties Services Pty Ltd (1983) 48 ALR 667 Fox v Everingham (1983) 50 ALR 337 Twiddle v Bradley (1990) 2 Qd R 464 Hanflex Pty Ltd v. NS Hope & Associates (1990) 2 Qd R 218 Gardam v George Wills & Co Ltd (1988) 82 ALR 415 Burg Design Pty Ltd v Wolki [1999] FCA 388 Landel Pty Ltd v Redland Shire Council and Lipoma Pty Ltd (2001) QCA 120 Argy v Blunts & Lane Cove Real Estate Pty Ltd (1990) 94 ALR 719 Menmel Pty Ltd v The Great Australian Bite Pty Ltd (1997) ATPR 41-553 Re La Rosa; ex parte Norgard v Rodpat Nominees Pty Ltd (1991) 104 ALR 237 Trade Practices Commission v Manfel Pty Ltd(In Liquidation) (1991) 105 ALR 520 Burke v LFOT Pty Ltd (2000) ATPR 41-781
COUNSEL:	Mr A. Maher for the plaintiff Mr Hassett for the first and second defendants Mr D.G. Clothier for the third defendant
SOLICITORS:	Quinn & Scattini for the plaintiff David Prince & Associates for the first and second defendants Brian…