Lonergan v JQZ Eleven Pty Ltd

Lonergan and another sued JQZ Eleven, a property developer, over the purchase of a property in an off-the-plan residential tower development. The plaintiffs sought to purchase a unit that was represented to have black privacy screens on its balcony, a feature that was particularly important to one of the plaintiffs due to a skin condition. However, the developer omitted numbering levels 4 and 14, leading to the plaintiffs’ unit being on an unnumbered level without the promised privacy screens. Additionally, the developer failed to warn the plaintiffs about the siting of intrusive structural columns and an air-conditioning unit in the property as finally built.

The court had to determine whether the developer's agent had misled or deceived the plaintiffs by representing that their unit would have black privacy screens on a numbered level, despite the omission of lower level numbers. The court also considered whether the developer's agent failed to warn the plaintiffs about the siting of structural columns and the air-conditioning unit, and whether these representations, if made, were as to future matters or present facts. Furthermore, the court examined whether a series of disclaimers in contractual provisions and promotional material were effective in dispelling any misleading or deceptive quality of the representations.

The court found that the developer was liable for misleading or deceptive conduct. The developer's agent had represented that the plaintiffs’ unit would have black privacy screens on a numbered level, but this was not the case due to the omission of lower level numbers. The developer also failed to warn the plaintiffs about the siting of structural columns and the air-conditioning unit. The court held that these representations were not merely as to future matters, but as to present facts, as the plaintiffs were relying on the developer's representations at the time of purchase. The court rejected the developer's argument that the disclaimers were effective in dispelling any misleading or deceptive quality of the representations. The court ordered the developer to repay the deposit plus interest to the plaintiffs and precluded the developer from prosecuting a claim against the plaintiffs for breach of contract or enforcing a contractual provision in respect of the purchaser’s default.