Destec Pty Ltd v Rmem Investments Pty Ltd - [2020] WADC 105

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CHAMBERS

LOCATION:   PERTH
CITATION:   DESTEC PTY LTD -v- RMEM INVESTMENTS PTY LTD [2020] WADC 105
CORAM:   DEPUTY REGISTRAR HEWITT
HEARD:   22 JULY 2020
DELIVERED          :   13 AUGUST 2020
FILE NO/S:   CIV 1644 of 2019
BETWEEN:   DESTEC PTY LTD
Plaintiff

AND

RMEM INVESTMENTS PTY LTD
Defendant

Catchwords:

Practice and procedure - Defendant's application for summary judgment - Whether the terms of an agreement for possession before settlement are capable of extinguishing a claim under the Australian Consumer Law

Legislation:

Nil

Result:

Application dismissed

Representation:

Counsel:

Plaintiff	:	Mr M C Goldblatt
Defendant	:	Mr N D C Dillon

Solicitors:

Plaintiff	:	Armeli & Molony Lawyers
Defendant	:	Capital Legal

Case(s) referred to in decision(s):

Brighton Australia Pty Ltd v Multiplex Constructions Pty Ltd [2018] VSC 246

DEPUTY REGISTRAR HEWITT:

This action was commenced by a writ of summons filed by the plaintiff on 6 May 2019 followed by a statement of claim lodged on 7 June 2019.
In this action the claim revolves around the purchase by the plaintiff of a commercial premises and in particular, a gantry or bridge crane within those premises described as a 25 tonne crane. The plaintiff took possession of the premises but did not immediately put the 25 tonne crane into use. After a period of somewhat over a year the plaintiff needed to put the 25 tonne crane into use and for that purpose engaged a person of appropriate expertise to inspect and service the crane. As a result of that process it was brought to the attention of the plaintiff that the crane had never been certified as fit for use by the Occupational Health and Safety department and its method of installation in the premises was such that it could not be safely utilised for loads exceeding 12 tonnes, that of course being approximately 50% of its rated capacity.
Within the contract for the sale of the commercial property there were terms relating to the crane and in particular as outlined in par 4.4 of the statement of claim the following:
4.4The Agreement was conditional upon the following conditions being carried out by RMEM prior to the settlement of the Premises (see Annexure B of the Agreement):
(a)The Cranes were to be serviced and certified, namely registered with WorkSafe in accordance with Schedule 4.2 of the Occupational Safety and Health Regulations for the next 12 months; and
(b)RMEM warranted that there were no outstanding work orders from the City of Canning against the Premises or building.
(the Conditions).
The action commenced by the plaintiff sought damages on a number of heads namely damages for breach of contract, common law misrepresentation and breach of the Australian Consumer Law and interest.
The defendant has now brought a chamber summons seeking dismissal of the action pursuant to O 16 of the Rules of the Supreme Court 1971 (WA). That application is brought well out of time and the explanation offered for that lateness is the fact that the defendant unearthed, at a late stage in the proceedings, an agreement for possession before settlement which contains the following paragraphs:
3.The Contact at Possession Date ceases to be subject to any condition for the Buyer's benefit other than those set out in the 2011 General Conditions (unless excluded in this agreement) and the Buyer will not be entitled to rescind or terminate the Contract for any reason, other than the Seller's default.
4.At Possession Date the Buyer accepts the Property on an 'as is' basis and will not be entitled to rely on any pre-contractual or contractual representation made by the Seller or the Seller Agent and will make no claim against the Seller or the Seller Agent for any repairs, defects, errors or omissions in respect of the condition or character of the Property for any Loss incurred after entering into this Agreement.
The argument which is advanced by the applicant/defendant is that by reason of the agreement for possession before settlement, the quoted paragraphs of the agreement had the effect of extinguishing any claim which the plaintiff may have had against the defendant in relation to the transaction other than various matters which might be contained in the 2011 General Conditions which are not of relevance in the present action.
Of the various heads of claim which are pursued by the plaintiff, that upon which I intend to focus, is the claim under the provisions of the Australian Consumer Law.
Evidence has been adduced on behalf of the plaintiff that its attention was attracted to the commercial premises by an advertisement which in particular identified the presence within the premises of a 25 tonne crane. A copy of the relevant advertisement appears in the affidavit of Mr Steven Leslie Wyatt sworn 11 June 2020 in which were the words 'we are pleased to offer to market an exceptional opportunity to purchase a highly functional clear span office/workshop with a 25 tonne crane'.
Mr Wyatt who was a director of the plaintiff testified that the presence of the 25 tonne crane was a factor which influenced the decision of the plaintiff to inspect the property and ultimately to offer to purchase it.
The importance of the 25 tonne crane is also reflected in the terms of the contract which was entered between the parties and its various references to the crane and its certification and so forth. What therefore is the effect of the agreement for possession before settlement and the clauses which I have cited to the portion of the plaintiff's claim which is based on the Australian Consumer Law?
In my view the alteration to the purchase agreement by the agreement for possession brought before settlement are of no consequence and have no effect on the claim brought under the Australian Consumer Law.
There is a long line of authority establishing the proposition that the provisions of the Act cannot be contracted out and were authority for that proposition to be required. I rely on a recent case: Brighton Australia Pty Ltd v Multiplex Constructions Pty Ltd [2018] VSC 246. That case both recognises the existence of the principle I have just stated but also reflects decisions of the court, not only to recognise the principle, but to reinforce it. I therefore have, in the present circumstances, testimony that the representation that there was a 25 tonne crane in the premises is a fact that influenced the plaintiff's decision to buy the premises. That it was important to the plaintiff that the crane be functional is borne out by some of the conditions to the contact.
Furthermore, in my view a description of a crane as a 25 tonne crane carries with it as a necessary implication that it was capable of lifting loads to that limit. In fact it appears the crane was not capable of lifting to those limits and was not certified for such use under the provisions of the Occupational Health and Safety Act 1984 (WA) which is a requirement. As I have noted, a contractual arrangement is not capable of depriving a party who has acted in reliance on conduct and representations which might be described as deceptive and misleading conduct from a remedy under the Australian Consumer Law.
Argument was advanced by the defendant that the facts and the exchanges between the parties establish that the plaintiff did not rely on the defendant's representation but rather, the clause of the contract concerning the crane. In my view those facts make it clear that the plaintiffs were relying on the representation that the premises did have a 25 tonne crane and the defendant's argument underlines that to be the case.
The outcome is of course not by any means certain, but in order to succeed in a defendant's summary judgment application, it is necessary to in effect indicate that the cause of action pursued by the plaintiff is hopeless. Since this plaintiff attacks on a number of fronts, it is only necessary for it to establish that it has an arguable case on any one of those fronts.
In my opinion that it has achieved and I take the view that it is not necessary to consider any other aspect of the claim before reaching a decision that the application for summary judgment should be dismissed and that is the order which I shall make.

I certify that the preceding paragraph(s) comprise the reasons for decision of the District Court of Western Australia.
LF
Court Officer
13 AUGUST 2020