Hyder v McGrath Sales Pty Ltd - [2017] NSWSC 1647

Supreme Court

New South Wales

Summary available

Medium Neutral Citation: Hyder v McGrath Sales Pty Ltd [2017] NSWSC 1647
Hearing dates: 5, 6, 7, 8 September 2017
Date of orders: 30 November 2017
Decision date: 30 November 2017
Jurisdiction: Equity - Commercial List
Before: Parker J
Decision:
Proceedings dismissed

Catchwords: Consumer Law – misleading and deceptive conduct – sale of residential property – purchase in name of wife where husband is property developer and made decision to purchase – representations as to private parking on right of way made by real estate agents and on websites, signs and brochures – claim brought against vendor’s agents – statement of law as a statement of opinion – causation – “no transaction” case – emotional reasons for purchase – loss – expert valuation evidence – direct comparison analysis in a thin and high value market – estimate of damages – contributory negligence – purchaser’s failure to take reasonable care in conducting enquiries – disclaimers in special conditions to contract for sale of property – right of way reported to purchaser prior to purchase
Legislation Cited: Competition and Consumer Act 2010 (Cth), Sch 2 ss 18, 236
Cases Cited: Forrest v Australian Securities and Investments Commission (2012) 247 CLR 486; [2012] HCA 39
Trewin v Felton (2007) 13 BPR 24,579; [2007] NSWSC 851
Williams v Pisano (2015) 90 NSWLR 342; [2015] NSWCA 177
Yorke v Lucas (1985) 158 CLR 661; [1985] HCA 65
Category: Principal judgment
Parties: Amy Louise Hyder (Plaintiff)
McGrath Sales Pty Ltd (Defendant)
Representation:
Counsel:
J Sleight (Plaintiff)
RCA Higgins/PJ Strickland (Defendant)
Solicitors:
Neville & Hourn Legal (Plaintiff)
Colin Biggers & Paisley (Defendant)

File Number(s): 2016/107772
Publication restriction: Nil

Judgment

These proceedings concern misrepresentations allegedly made in the course of the sale of a property in Sydney’s eastern suburbs for $9.4 million. Contracts were exchanged in October 2014 and the sale was completed in February 2015.
The then owner of the property, Edward Jewell-Tait, retained the defendant, McGrath Sales Pty Ltd (“McGrath”), as joint selling agent with Ben Collier Real Estate Pty Ltd and Nick Bordin Real Estate Pty Ltd. The actual sale of the property was conducted by Mr Collier and Mr Bordin but there is no dispute that their conduct is to be attributed to McGrath for the purposes of the claim against it. For convenience, in the balance of this judgment I will refer to the representations made by Mr Collier and Mr Bordin as representations of McGrath.
The property was sold by Mr Jewell-Tait under the standard Contract for the Sale of Land – 2005 Edition, incorporating some further special conditions. The purchaser was the plaintiff, Amy Louise Hyder. The property was purchased as a family home for Mrs Hyder, her husband, Elton Matthew Hyder IV (known as Matthew), and their three children. Mrs Hyder was brought up in Sydney. Mr Hyder is originally from Texas.
The property is in Ginahgulla Road in Bellevue Hill. It is a battle-axe block. The block was…

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: [2017] NSWSC 1647
Decision Date: 30 November 2017

CaseChat Overview and Summary

The case of Hyder v McGrath Sales Pty Ltd involves a dispute between the plaintiff, Mr Hyder, and the defendant, McGrath Sales Pty Ltd, the real estate agents. The issue revolves around misleading and deceptive conduct by the agents in the sale of residential property. The property was purchased in the name of the plaintiff's wife, although the decision to purchase was made by the husband who is a property developer. The agents made representations concerning private parking on a right of way, which were allegedly misleading. These representations were made on websites, signs, and brochures.

The primary legal issues the court had to address included whether the representations by the agents constituted misleading or deceptive conduct under Australian consumer law, and if so, whether the plaintiff had suffered a loss as a result. The court also needed to determine if the agents' statements were considered opinions or factual representations, the extent of the causal link between the alleged misleading conduct and the loss, and whether the plaintiff had contributed to the loss by failing to take reasonable care in conducting enquiries. The court had to consider expert valuation evidence and the methodology used to estimate the loss, as well as the effect of disclaimers in the special conditions of the contract for sale of property.

The court found that the representations made by the agents were misleading and deceptive. It held that the agents' statements about private parking on the right of way were not merely opinions but factual assertions that influenced the plaintiff's decision to purchase. The court determined that the plaintiff suffered a loss due to the misleading representations, even though the property was purchased for emotional reasons rather than purely investment purposes. The court assessed the expert valuation evidence and accepted the direct comparison analysis in the context of a thin and high-value market. It held that the plaintiff's failure to take reasonable care in conducting enquiries was a factor in the loss but did not absolve the agents from liability. The court also considered the effect of the disclaimers in the contract, finding they did not negate the agents' liability for misleading conduct. The court awarded damages to the plaintiff and considered the defendant's contributory negligence.

The court ordered the defendant to pay damages to the plaintiff, reflecting the loss suffered due to the misleading and deceptive conduct. The court also noted that the plaintiff's contributory negligence reduced the amount of damages payable. The court's decision underscores the importance of real estate agents providing accurate and truthful information to prospective buyers and the potential consequences of misleading conduct in property sales.

Orders