Level Investments Pty Ltd v Daynes Developments Pty Ltd (Externally Administered)
[2011] QCAT 399
•12 August 2011
CITATION: Level Investments Pty Ltd v Daynes Developments Pty Ltd (Externally Administered) and Anor [2011] QCAT 399
PARTIES: Level Investments Pty Ltd v Daynes Developments Pty Ltd (Externally Administered)
Mr Adrian John Daynes
APPLICATION NUMBER: OCL034-11
MATTER TYPE: Other civil dispute matters
HEARING DATE: On the papers
HEARD AT: Brisbane
DECISION OF: Mr Nathan Jarro, Member
DELIVERED ON: 12 August 2011
DELIVERED AT: Brisbane
ORDERS MADE:
1. Pursuant to section 488 of the Property Agents and Motor Dealers Act 2000, the claim is allowed in the sum of $17,674.51.
2. Pursuant to section 489 of the Property Agents and Motor Dealers Act 2000, at the expiration of the appeal period the Chief Executive must pay to the Applicant the sum of $17,674.51 from the Claim Fund, and if there is an appeal, payment must not be made until after the appeal is finally decided.
3. Pursuant to section 488(3)(c) of the Property Agents and Motor Dealers Act 2000 the Respondents, Daynes Developments Pty Ltd (Externally Administered) and Adrian John Daynes are named as the persons liable for the financial loss of the Applicant.
4. Upon payment from the Claim Fund and pursuant to sections 490 and 530 of the Property Agents and Motor Dealers Act 2000, the Respondents, Daynes Developments Pty Ltd (Externally Administered) and Adrian John Daynes are liable jointly and severally to reimburse the Claim Fund by paying the sum of $17,674.51 to the Chief Executive, Department of Justice and Attorney-General.
CATCHWORDS: Claim against fund – real estate agent and company named as persons responsible
Property Agents and Motor Dealers Act 2000
APPEARANCES and REPRESENTATION (if any):
This matter was heard and determined on the papers in accordance with section 32 of the Queensland Civil and Administrative Tribunal Act 2009.
REASONS FOR DECISION
Background
[1]On 8 February 2010, the Department of Employment, Economic Development and Innovation received a claim against the claim fund established under the Property Agents and Motor Dealers Act 2000 (“the Act”) by Level Investments Pty Ltd, through its director, Mr Dale Cartwright. Level Investments Pty Ltd (“the Applicant”) made the following allegations against Adrian Daynes and his company Daynes Developments Pty Ltd trading as Re/Max Metro (“the Respondents”):
a) On 4 March 2009, the Applicant contracted to purchase the Respondents’ property at Units 3 and 4, 16 Mayfield Street, Moorooka.
b) The Applicant paid $20,000 deposit to the Respondent’s trust account.
c) It was a term of the contract that the deposit be released early to the Respondents upon the Applicant confirming that the contract was unconditional.
d) The original settlement date of the contract was postponed from 3 April 2009 to 9 April 2009 because the second mortgagee of the Respondents refused to provide the required mortgage release on the basis that there were insufficient funds to release its mortgage.
e) On 9 April 2009, the contract did not proceed to completion because the second mortgagee refused to provide the required mortgage release due to insufficient funds at settlement.
f) On 17 April 2009, the Applicant terminated the contract as the Respondents were unable to give clear title to the property.
g) On 17 April 2009, the Applicant demanded the return of the deposit from the Respondents as the contract had not been completed.
h) The Respondents returned only $3,087 of the deposit to the Applicant.
i) The Applicant became aware of the financial loss on or about 17 April 2009.
j) The Applicant made repeated requests for the return of the remaining $16,913 from the Respondents.
k) The Applicant estimated its loss at $22,630 which included:
(i) bank valuation fees;
(ii) bank fees;
(iii) legal fees and costs of searches;
(iv) balance of unreturned deposit.
[2]Attached to its claim, the Applicant included an invoice from its solicitor dated 17 April 2009 for an amount of $761.51 as a result of the attempted conveyance, as well as a letter from Bank of Western Australia Limited dated 3 December 2009 identifying the associated fees incurred for the provision and establishment of the loan facility which remained due and outstanding. This amount totalled $4,737. The latter document recorded, amongst other things, as follows:
RE: Loan proposal to assist with purchase of Units 3 and 4 16 Mayfield Road, MOOROOKA
We refer to the above matter and would like to bring to your attention the associated fees incurred for the provision in the establishment of a loan facility which remain due and outstanding.
As at the date of this letter the fees mentioned below and payable by you is as follows:
Valuation Fee $1,100
(valued March 09)
Valuation Fee $ 770
(Re-valued Sept 09)
Application Fee $2,200
(March application for original purchase)
Application Fee $ 625
(September re-work and approval)
Title searches performed $ 42Total Amount Owing $4,737
[3]In addition, the Applicant also included a copy of its letter to the Office of Fair Trading dated 6 May 2009 complaining about the conduct of the Respondents in refusing to return the full deposit.
[4]On 15 November 2010, the Department of Employment, Economic Development and Innovation wrote to the Applicant seeking further information in relation to the claim and in particular further information in relation to the total financial loss allegedly sustained by the Applicant. The Applicant responded on 8 December 2010 with a copy of the contract of sale.
[5]Notice of the Applicant’s claim was sent to the Respondents on 9 December 2010. On 3 February 2011, the Applicant gave the Chief Executive of the Department of Employment, Economic Development and Innovation written notice that it wanted to proceed with its claim. It confirmed that it was seeking the return of the deposit of $16,913.
[6]The Department of Employment, Economic Development and Innovation referred the Applicant’s claim for determination by the Queensland Civil and Administrative Tribunal under the provisions of Chapter 14 of the Act.
The Law
[7]The claim is made under s 470 of the Act. The Applicant claims to have suffered a financial loss as a result of its dealings with the Respondents.
[8]The jurisdictional provisions of the Act are contained in s 450. The provisions in relation to the functions of the Tribunal are contained in s 488 of the Act. The claim fund is established under s 408 of the Act, and in accordance with s 409 of the Act, the fund must be used to pay the amounts of all claims allowed against it. Section 488 of the Act sets out the process for deciding the claim. The Tribunal must be satisfied that:
a) an event as mentioned in s 470(1) happened; and
b) the claimant suffered financial loss because of the event.
[9]The Tribunal must also take into account any amount the claimant might reasonably have received or recovered if not for the claimant’s neglect or default and any amount ordered to be paid to the claimant as compensation to the claimant under ss 530A, 572D or 592A of the Act, as provided in s 488(3)(a) of the Act.
[10]When allowing a claim in whole or in part, the Tribunal must decide the amount of the claimant’s financial loss and name the person who is liable for the loss as provided in s 488(3)(b) and (c) of the Act.
The Event and the Loss
[11]The Respondents provided little information to the Department of Employment, Economic Development and Innovation after the Applicant made its complaint to the Office of Fair Trading about the Respondent’s conduct. Presumably that is why the Department did not direct an investigation into the claim. A copy of the claim file was provided to the Tribunal; the file consisted largely of evidence produced in support of the application.
[12]The Respondents provided a letter to the Office of Fair Trading on 24 January 2011, suggesting that the Applicant ‘double dipped’ from the initial unsuccessful transfer in circumstances where Mr Cartwright allegedly received $17,000 from Mr David Napier, the Respondent’s business partner and second mortgagee of the property. The Respondents submitted to the Office of Fair Trading that because of this, the Applicant would not have been out of pocket from the unsuccessful sale of the property.
[13]In response to this allegation, the Applicant provided evidence from Mr Napier in the form of a Statutory Declaration. Mr Napier categorically denied ever paying the amount asserted by the Respondents to Mr Cartwright. The Tribunal is satisfied that the Applicant did not receive the amount as alleged by the Respondents.
[14]Further the Tribunal is satisfied to the requisite standard, in light of the largely uncontested evidence, of the following:
a) The Applicant paid $20,000 deposit to the Respondent’s trust account.
b) The sale of the property did not proceed and the Applicant terminated the contract, for which the Applicant was entitled to a refund of the deposit.
c) The Applicant received only $3,087 out of the deposit.
d) The Respondents have failed to return the remainder of the deposit, being $16,913.
e) The Respondents have misappropriated the Applicant’s deposit.
f) In addition, the Applicant incurred the cost of an invoice from its solicitor dated 17 April 2009 for an amount of $761.51.
g) Whilst the Applicant sought an additional amount from Bank of Western Australia Ltd for bank and valuation fees, such amount is refused as the Applicant has not provided sufficient evidence to the Tribunal’s satisfaction of proof of payment of the amount claimed.
h) Accordingly the Applicant has suffered financial loss in the amount of $17,674.51 in relation to property and its dealings with the Respondents.
i) Daynes Developments Pty Ltd t/a Re/Max Metro and Adrian Daynes are the relevant persons for the purposes of s 470(1)(e) of the Act.
j) The Respondents are named as the persons responsible for this loss.
Other Matters to be Considered
[15]There has been no relevant negligence or default by the Applicant identified and no amounts of compensation ordered to be paid under ss 530A, 572D or 592A of the Act.
Conclusion
[16]The amount owing to the Applicant by the Respondents is therefore found to be in the sum of $17,674.51. The Respondents have misappropriated the Applicant’s deposit and the Applicant has suffered financial loss because of the Respondents’ actions. The Respondents, being Adrian Daynes and his company Daynes Developments Pty Ltd trading as Re/Max Metro, are the relevant persons for the purposes of s 478(1)(e) of the Act and as such are the named persons who are responsible for the loss.
ORDERS
[17]In the circumstances, the orders will be as follows:
i) Pursuant to section 488 of the Property Agents and Motor Dealers Act 2000, the claim is allowed in the sum of $17,674.51.
ii) Pursuant to section 489 of the Property Agents and Motor Dealers Act 2000, at the expiration of the appeal period the Chief Executive must pay to the Applicant the sum of $17,674.51 from the Claim Fund, and if there is an appeal, payment must not be made until after the appeal is finally decided.
iii) Pursuant to section 488(3)(c) of the Property Agents and Motor Dealers Act 2000, the Respondents, Daynes Developments Pty Ltd (Externally Administered) trading as Re/Max Metro and Adrian John Daynes, are named as the persons liable for the financial loss of the Applicant.
iv) Upon payment from the Claim Fund and pursuant to sections 490 and 530 of the Property Agents and Motor Dealers Act 2000, the Respondents, Daynes Developments Pty Ltd (Externally Administered) trading as Re/Max Metro and Adrian John Daynes are liable jointly and severally to reimburse the Claim Fund by paying the sum of $17,674.51 to the Chief Executive, Department of Justice and Attorney-General.
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