BGM Projects Pty Ltd v Durmaz

Case [2020] QCA 146


SUPREME COURT OF QUEENSLAND

CITATION:

BGM Projects Pty Ltd v Durmaz [2020] QCA 146

PARTIES:

BGM PROJECTS PTY LTD
ACN 102 165 328
(respondent/applicant)
v
STEVE DURMAZ
(appellant/respondent)

FILE NO/S:

Appeal No 5552 of 2020
SC No 12878 of 2019

DIVISION:

Court of Appeal

PROCEEDING:

Application to Strike Out
Application for Security for Costs

ORIGINATING COURT:


Supreme Court at Brisbane – [2020] QSC 87 (Brown J)

DELIVERED ON:

30 June 2020

DELIVERED AT:

Brisbane

HEARING DATE:

19 June 2020

JUDGES:

Morrison JA

ORDERS:

1.   The notice of appeal is struck out.

2.   The appellant pay the respondent’s costs of and incidental to the application on the standard basis.

CATCHWORDS:

APPEAL AND NEW TRIAL – PROCEDURE – QUEENSLAND – OTHER MATTERS – STRIKE OUT – where the respondent/applicant has applied to strike out the notice of appeal – where in the alternative the respondent/applicant seeks an order for security for costs – where Durmaz Corporation purchased a lot in the respondent/applicant’s development – where the contract of sale included a series of covenants governing the design and construction of dwellings on the lot – where Annexures C and D to the contract of sale were Deeds in favour of the respondent/applicant, executed on behalf of Durmaz Corporation by the appellant/respondent – where the appellant/respondent caused Durmaz Corporation to construct a non-approved shed on the lot – where there was no challenge to the fact that the shed had been constructed without approval from BGM, in breach of the building covenants, and in breach of the order of Applegarth J made on 4 June 2019 – where Brown J found that it was clear that Durmaz Corporation had signed the Deeds and agreed to be bound by the building covenants – where the order against which the appeal has been brought was that of Brown J – where the order was that Durmaz Corporation Pty Ltd cause a constructed shed on real property to be removed, and pay costs on an indemnity basis – whether the notice of appeal should be struck out

Uniform Civil Procedure Rules 1999 (Qld), r 371(2)

BGM Projects Pty Ltd v Durmaz Corporation Pty Ltd [2020] QSC 87, cited
Colgate-Palmolive Co v Cussons Pty Ltd (1993) 46 FCR 225; [1993] FCA 536, cited
Re Cameron [1996] 2 Qd R 218; [1996] QCA 37, cited
Robertson v Hollings & Ors[2009] QCA 303, cited
von Risefer v Permanent Trustee Co Pty Ltd [2005] 1 Qd R 681; [2005] QCA 109, cited

COUNSEL:

R A Quirk for the respondent/applicant
The appellant/respondent appeared on his own behalf

SOLICITORS:

Clinton Mohr Lawyers for the respondent/applicant
The appellant/respondent appeared on his own behalf

  1. MORRISON JA: The respondent has applied to strike out the notice of appeal in this matter: (i) pursuant to the inherent jurisdiction of the Court on the basis that it is frivolous, vexatious or an abuse of process; or (ii) pursuant to r 371(2) of the Uniform Civil Procedure Rules 1999 (Qld) as…

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AGLC
BGM Projects Pty Ltd v Durmaz [2020] QCA 146
Case
[2020] QCA 146
Decision Date

CaseChat Overview and Summary

The case of BGM Projects Pty Ltd v Durmaz involves an appeal against an order made by Brown J in the Queensland Supreme Court. The order required Durmaz Corporation Pty Ltd to remove a shed constructed without approval on a lot it purchased from BGM Projects Pty Ltd. The appeal was brought by Mr Durmaz, who is personally liable for the orders against Durmaz Corporation. The central legal issue was whether the appeal notice should be struck out due to the appellant's incompetency and the lack of a valid ground for appeal. The court found that the appeal was incompetent as the party who is the subject of the order, Durmaz Corporation, was not a party to the appeal. Additionally, the grounds for appeal were poorly articulated and centred around a claim of misrepresentation by the developer, BGM, which was not substantiated by any evidence.

The court held that the appeal was incompetent because the party appealing, Mr Durmaz, was not the party subject to the orders made by Brown J. Furthermore, the grounds for appeal were not clearly stated in the notice of appeal and were only vaguely outlined in the submissions. The court found that Mr Durmaz's primary contention was that BGM had made a misrepresentation regarding the binding nature of the covenants, which was not supported by any evidence. The court concluded that there were substantial obstacles to the appeal being successful and that the appeal notice should be struck out. The court also ordered that the appellant pay the respondent's costs on the standard basis.

Orders

Orders of the court

1. The notice of appeal is struck out.

2. The appellant pay the respondent’s costs of and incidental to the application on the standard basis.

Background

Background to the litigation

The order against which the appeal has been brought was that of Brown J, delivered on 24 April 2020.[1] That order was that Durmaz Corporation Pty Ltd: (a) cause a constructed shed on real property at Burrum Heads to be removed; and (b) pay costs on an indemnity basis.[1]BGM Projects Pty Ltd v Durmaz Corporation Pty Ltd [2020] QSC 87.Background matters A short recitation of the history of this matter assists in understanding the issues on the current application. The applicant, BGM Projects Pty Ltd (“BGM”) is the developer of “On the Beach” at Burrum Heads. The contracts for the sale of individual lots in the development included a series of covenants governing the design and construction of dwellings on those lots. The introductory words of the covenants were as follows:“This Covenant is an agreement between the Developer, BGM Projects Pty Ltd (“BGM Projects”), who is committed to providing a quality residential environment, and the Buyer who intends to construct a dwelling. This Covenant defines the quality of the completed project, both environmentally and aesthetically.Many items will reflect the design requirements of the Fraser Coast Regional Council, whilst others reflect the ‘liveability’ vision of the completed project and are a natural product of the unique beachfront and lakeside topography.Buyers may take comfort in the knowledge that their investment is not devalued by an ill-balanced mix of poorly designed houses or temporary dwellings.” On 7 September 2018 Durmaz Corporation Pty Ltd purchased a lot from an existing owner, Mr Smith. The contract of sale included Special Condition 2 in these terms:“2.(a)The buyer acknowledges that every person that purchases land at On the Beach (of which the land sold in this contract forms part) is required to comply with the attached Community Development Standards and Building Covenant Conditions;(b)The buyer agrees to sign the attached Continuation of Covenant and to be bound in all respects by the said covenants from date of settlement of this contract.(c)The buyer agrees to cause any person to whom he sells the land to complete and sign a notification in the same terms and deliver it to BGM Projects Pty Ltd.” The covenants were Annexure A to that contract. Annexures C and D were Deeds in favour of BGM, executed on behalf of Durmaz Corporation by Mr Durmaz. On 31 March 2019 Mr Durmaz placed a caravan on the property, indicating that he intended to live in it. Despite being told that having a caravan was in breach of the building covenants, Mr Durmaz stated he would not remove it. On 1 April 2019 Mr Durmaz informed BGM’s contract administrator that he intended to build any house he wanted on the property, and did not intend to submit any building plans to BGM for approval, or to otherwise comply with the building covenants. By 22 May 2019 BGM became aware that Mr Durmaz had commenced construction works for a shed. Following objection by BGM, the solicitors for each side corresponded about the failure to obtain approvals under the building covenants. Mr Durmaz, for Durmaz Corporation, said it would undertake in writing to comply with the building covenants. That undertaking was supplied to BGM.

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

Mr Durmaz contended that not all owners had signed Deeds binding them to the building covenants, and therefore the covenants were illegal. He also contended that BGM had engaged in misleading conduct. However, Brown J found that he had presented no evidence to support those allegations, nor had he sought an adjournment to do so. In any event, her Honour found that it was clear that Durmaz Corporation had signed the Deeds and agreed to be bound by the building covenants.[6] The orders made were that Durmaz Corporation remove the shed and pay costs on an indemnity basis.[6]Reasons below at [54].Consideration There are quite a number of substantial obstacles confronting success in this appeal. I will attempt to summarise them. First, the orders of Justice Brown were made against Durmaz Corporation, not Mr Durmaz personally. However, it is Mr Durmaz, personally, who is the appellant. The appeal is incompetent as the party the subject of the challenged orders is not a party to the appeal. Secondly, the Notice of Appeal states the grounds to be: “… all grounds appeal based on the misrepresentation of contract for covernant [sic]”. The only articulation of the grounds appears in the outline filed by Mr Durmaz. That included these points:(a)he was asked to enter into a deed of covenant before the purchase commenced and agreed “with the belief that there was no ill intention by the contract”;(b)soon after, two things became apparent; one was that “my proposed build was not allowed for any reasonable reasons given to me”; and the second was that he “later learned from other residents that not everyone had entered into a signed deed of covenant”;(c)that was “a misrepresentation of the so called covenant and continued to this day, no purchaser was ever informed of this fact before signing and entering into a contract that has no value as a proposed product”;(d)he had recently found a file of a Mr Lee, “who had no contract of covenant in purchase nor did the previous owner”; after the case before Brown J he had sought access to that file; and(e)his contention was that: “this whole event has been about the developer and his years of continuing efforts to impede upon residents, harass and hinder by almost all means in an effort to protect the contracts survival and preservation against litigation, when the first non signatories appeared instead of advising residents of the estate of the new situation with the contracts now to be varied and changed so that it may suit the new reality on the ground”; and “BGM Projects Pty Ltd continued to misrepresent the contracts and impede upon residents with the illegal misuse of the contracts causing individuals personal and financial hardship and harm”. Thus, as developed during oral submissions before me, Mr Durmaz has articulated only one ground as the basis for the appeal. It is that the developer, BGM, had made a material misrepresentation in the introductory words of the community development standards and building covenant conditions. Specifically it was in the sentence: “Buyers may take comfort in the knowledge that their investment is not devalued by an ill-balanced mix of poorly designed houses or temporary dwellings.” The contention advanced was that there was evidence that some other lot owners were not bound to the covenants as they were not included in their contracts of sale, thereby making the assertion that all owners were bound, and the assertion that buyers could take comfort that their investment would not be devalued, misleading or deceptive.