Chadha v Taarnby & Taarnby P/L

[2012] SADC 133

District Court of South Australia

(Civil: Minor Civil Review)

CHADHA & ANOR v TAARNBY & TAARNBY P/L

[2012] SADC 133

Reasons for Decision of His Honour Judge Clayton (ex tempore)

9 October 2012

MAGISTRATES - APPEALS AND REVIEW

Review of Magistrates decision in minor civil claim giving judgment for real estate firm against vendor of property for costs of auction.

Decision of Magistrate affirmed.

Land and Business (Sale and Conveyancing) Act 1994 s 20(2), s 20(5), s 24, referred to.

CHADHA & ANOR v TAARNBY & TAARNBY P/L
[2012] SADC 133

1. This is an application to review a minor civil decision. The plaintiff is a real estate firm, a franchisee of a well known and reputable firm. The defendant, Mr Chadha, retained the plaintiff to sell a property at Goodwood. The plaintiff has claimed the expenses incurred in connection with an auction. Those expenses total $2653.70.

2. In an extempore judgment dated 18 June 2012 the learned magistrate ordered that there should be judgment for the plaintiff. He also awarded costs on the summons of $123 and attendance fees for Mr Bolto and Mr Peluso from the plaintiff totalling $150.

3. The issues raised before the magistrate were not identical with the issues which have been raised on this review. Mr Chadha has not satisfied me that there was any error in the decision of the magistrate.

4. On this review Mr Chadha has argued a number of matters. First he argued that Mr Bolto and Mr Peluso from the plaintiff gave evidence simultaneously. He complained that decorum was not maintained by the magistrate. It is unnecessary for me to inquire into that complaint because on this review I need to consider the merits of the claim. However, I should say that there is no evidence to support the criticism made by Mr Chadha.

5. Mr Chadha complained Mr Peluso told his wife that he had a customer for the property. The customer referred to was apparently a medical practitioner. Mr Chadha has tendered two medical reports which establish that his wife suffers from depression. Those reports post-date the transaction in question by almost 12 months. In any event, they are not relevant to the claim.

6. Mr Chadha then argued that the plaintiff had not followed the procedures under the Land and Business (Sale and Conveyancing) Act 1994. In particular, he argued that the provisions of subs 20(2) have not been complied with. That sub‑section provides that: ‘An agent must not make a sales agency agreement unless the agent has first given the vendor a written guide that explains the vendor’s rights and obligations under such an agreement and is in the form approved by the Commissioner for the purposes of the section’.

7. The residential sales agency agreement was an exhibit before the magistrate. On p 14 of 17 there is a provision in the agreement which reads: ‘The vendor acknowledges receipt of (1) a copy of form R1 prior to signing this agreement and (2) a copy of this agreement’. It is admitted that receipt has been initialled by the vendors. I have been told by Mr Bolto and Mr Peluso and accept that the form R1 which is referred to in that clause is a form which provides the written guide explaining the vendor’s rights and obligations which is required by subs 20(2). I am not satisfied that the agent was in breach of subs 20(2).

8. Mr Chadha then complained that there was noncompliance with s 20(5); because after the auction the agent reduced the price asked for the property without the consent of the vendors. He argued that vitiated the contract and that the contract became null and void.

9. What happened after the auction is not relevant to the obligations of the vendor under the auction agreement. By that time the expenses in connection with the auction had already been incurred.

10. Before I leave the subject of the sales agency agreement I mention that it is that agreement which creates the liability on the part of the vendors to pay the expenses which are claimed.

11. Mr Chadha then argued that the agreement did not charge an establishment fee and that there was therefore no consideration for the agreement and the agreement was invalid. There is no merit in that argument. There was clear consideration for the agreement. By the written agreement, the vendors clearly offered to pay the expenses incurred in connection with the auction.

12. There was then a suggestion by Mr Chadha that the agents had influenced his wife by suggesting that they could sell the property for $1.1 million and that Mr Peluso was suggesting that he had a doctor customer. Mr Chadha complained that Mr Peluso did not bring any customer either to the auction or later. Well, that is a reflection of the market. I am not satisfied that any misrepresentation has been established and that matter of complaint is not a reason for the defendant not paying the expenses.

13. Mr Chadha complained that he could not put his evidence properly before the magistrate and that both gentlemen stood up at the same time. He complained that decorum was lost. I do not accept what he said. However, that is now irrelevant and those events have been superseded by this review.

14. I am satisfied that there was a valid sales agency agreement which specified an expense limit and I am satisfied that Mr Chadha and his wife are liable to pay the amount of the plaintiff’s claim.

15. Mr Chadha agreed that he had signed the receipt form in the sales agency agreement but said that he never received the form R1. I do not believe him. I reject that evidence. The receipt form on p.14 is in simple terms and the receipt has been signed by the vendors. There is also the sworn evidence of Mr Peluso that he provided form R1, which is a form of two pages, to the vendors. I accept the evidence of Mr Peluso that he gave the vendors the form R1 before they signed the agreement.

16. Mr Chadha in his reply raised a myriad of fresh complaints. He alleged that the plaintiffs had taken advantage of a caveat and other matters. I am not satisfied that any of those matters give rise to reason for the court to intervene.

17. Annexed to the application to review a minor civil decision, there is a document headed ‘Appeal’ which sets out six grounds of appeal. The first two grounds are general and take the matter nowhere. The third ground is a reference to s 20(2) of the Act and s 20(5) of the Act. I have already referred to those sections.

18. Paragraph 4 complains that the magistrate wrongly applied s 24 and did not apply s 20 of the Act. As I have mentioned, there is no issue with respect to s 20. Section 24 of the Act prevents an agent from lodging a caveat. That provision is irrelevant.

19. Paragraph 5 of the document asserts that the defendant did not charge any establishment fee and that there was no consideration for the sales agency agreement. I have dealt with that argument. There is no merit in that argument.

20. The sixth and final point is the allegation that the learned magistrate failed to appreciate the plaintiffs’ contentions and documentary evidence tendered by the plaintiff to the court, whereby the defendants obtained the sales agency agreement by misleading and wrongly misrepresenting the plaintiffs by stating that the property was already under the sales agency agreement with another property agent. There is a complaint that the defendants did not obtain a single contract for the property during the 90 day period of the contract. In that paragraph, Mr Chadha has obviously confused the identity of the parties where he refers to ‘plaintiff’. He obviously intended to refer to ‘defendant’ and vice versa.

21. All in all, there is no merit in the applicants’ application to review a minor civil decision. The application is dismissed. The judgment of the learned magistrate is affirmed.