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Commissioner for Fair Trading v Jonval Builders Pty Ltd

Commissioner for Fair Trading v Jonval Builders Pty Ltd

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Case Copied 31 December 2019 82 min read

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Supreme Court

New South Wales

Medium Neutral Citation: Commissioner for Fair Trading v Jonval Builders Pty Ltd [2019] NSWSC 1893
Hearing dates: 14 – 17 May 2018; 12 – 13 June 2018
Date of orders: 31 December 2019
Decision date: 31 December 2019
Jurisdiction: Common Law
Before: Rothman J
Decision:
(1) The Court directs the plaintiff to serve the defendants, through its solicitor, with a draft minute of order reflecting the foregoing reasons for judgment by 10 February 2020 and to file in court, by email to the Associate to Justice Rothman, by 24 February 2020, such draft of orders, or the minutes of order reflecting any agreement thereon between the plaintiff and the defendants.
(2) To the extent that there is no agreement that the draft minute of order reflects the foregoing reasons for judgment, the defendants shall file any proposed minute of order prescribing that which they submit reflects the foregoing reasons for judgment by 4pm on 24 February 2020.
Catchwords: CONSUMER LAW – Australian Consumer Law and Fair Trading Act – misleading or deceptive conduct – unconscionable conduct – sale of “movable” and “immovable” dwellings affixed to a site – sites approved for short-term occupation only – purchased after representations as to “permanent living” for retirees – analysis of provisions – factual summary – orders to be made for declarations and compensation – leave to apply for injunctions if conduct were to continue – plaintiff directed to file orders to reflect reasons
Legislation Cited: Australian Consumer Law (NSW), ss 3, 18 and 21, 232, 237, 239(1)(a)(i), 239(2)(a), 243(d)
Competition and Consumer Act 2010 (Cth), Sch 2, ss 140B and 140K
Fair Trading Act 1987 (NSW), ss 27, 28, 42, 43, 65, 72
Local Government Act 1993 (NSW), s 68
National Consumer Credit Protection Act 2009 (Cth)
Supreme Court Rules 1970 (NSW)
Trade Practices Act 1974 (Cth), s 52
Cases Cited: Australian Securities and Investments Commission v Kobelt (2019) 93 ALJR 743; [2019] HCA 18
Australian Securities and Investments Commission v Hellicar (2012) 247 CLR 345; [2012] HCA 17
Bell v Thompson (1934) 34 SR (NSW) 431
Blatch v Archer (1774) 98 ER 969
Blomley v Ryan (1956) 99 CLR 362; [1956] HCA 81
Briginshaw v Briginshaw (1938) 60 CLR 336; [1938] HCA 34
Brown, Lionel & Anor v Jam Factory Pty Ltd & Anor (1981) 35 ALR 79; [1981] FCA 34
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; [2004] HCA 60
Campbell v Backoffice Investments Pty Ltd (2009) 238 CLR 304; [2009] HCA 25
Campomar Sociedad Limited v Nike International Limited (2000) 202 CLR 45; [2000] HCA 12
Commercial Bank of Australia Ltd v Amadio (1983) 151 CLR 447; [1983] HCA 14
Cummins Generator Technologies Germany GmbH v Johnson Controls Australia Pty Limited (2015) 326 ALR 556; [2015] NSWCA 264
Fabre v Arenales (1992) 27 NSWLR 437
Gates v City Mutual Life Assurance Society Limited (1986) 160 CLR 1; [1986] HCA 3
Hurley…

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: [2019] NSWSC 1893
Decision Date: 31 December 2019

CaseChat Overview and Summary

The plaintiff, the Commissioner for Fair Trading, brought proceedings against Jonval Builders Pty Ltd for engaging in misleading or deceptive conduct under the Australian Consumer Law and Fair Trading Act. The defendant had sold a number of residential dwellings, which were affixed to land, to consumers on the basis that they were suitable for permanent living for retirees. The land, however, was approved only for short-term occupation, a fact which was not disclosed to the consumers. The court was required to determine whether the defendant’s conduct amounted to misleading or deceptive conduct and whether it was unconscionable, as well as to provide an appropriate remedy for the consumers.

The court held that the defendant had engaged in misleading or deceptive conduct by not disclosing the limitation on the use of the land. The representations that the dwellings were suitable for permanent living were not accurate given the zoning and approval status of the land. The court further found that the conduct was unconscionable because it exploited the special disadvantage of the consumers who were retirees seeking a permanent home. The court relied on the principle that parties dealing at arm’s length should be treated fairly and that parties should not take advantage of another’s special disadvantage. The court made declarations that the defendant’s conduct was misleading or deceptive and unconscionable. It also ordered compensation for the consumers and granted leave to apply for injunctions if the conduct were to continue in the future.

The orders included declarations that the defendant’s conduct was misleading or deceptive and unconscionable. Compensation was to be paid to the consumers who had been misled. The plaintiff was directed to file orders to reflect the reasons and the court’s findings. Additionally, leave was granted for the consumers to apply for injunctions if the misleading or unconscionable conduct were to continue. This decision reinforces the importance of full and accurate disclosure in sales transactions and the protection of vulnerable consumers under consumer protection laws.

Orders