Pazcuff Pty Ltd v Farmilo - [2009] QSC 230

SUPREME COURT OF QUEENSLAND

CITATION:

Pazcuff Pty Ltd v Farmilo & Ors [2009] QSC 230

PARTIES:

PAZCUFF PTY LTD (ACN 010 841 246)
(Applicant)
v
PETER WILLIAM FARMILO and PATRICIA MARGARET FARMILO
(First Respondents)
FARMILO PTY LTD (ACN 072 008 096)
(Second Respondent)

FILE NO/S:

121 of 2009

DIVISION:

Trial

PROCEEDING:

Application

ORIGINATING COURT:

Supreme Court, Cairns

DELIVERED ON:

14 August 2009

DELIVERED AT:

Cairns

HEARING DATE:

28 April 2009

JUDGE:

Jones J

ORDER:

The Court –
1. Declares that the first respondents failed to give the applicant a disclosure statement complying or, alternatively, substantially complying with s 206(1) of the Body Corporate and Community Management Act 1997 before the applicant entered into a contract dated 5 November, 2009 for the purchase from the first respondents of Lots 11, 13, 14, 16, 17 and 21 on BUP 70791, County of Nares, Parish of Cairns, (the ‘Unit Contract’) by failing to give to the applicant a disclosure statement signed by the first respondents, or a person authorised by the first respondents, before the applicant entered into the Unit Contract.
2. Declares that the applicant has lawfully cancelled the Unit Contract pursuant to s 206(7) of the Body Corporate and Community Management Act 1997.
3. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Unit Contract in the sum of $10,000.00.
4. Declares that the applicant has lawfully terminated the contract dated 5 November 2008 for the purchase by the applicant from the second respondent of the management and letting business known as Reef Gateway Apartments (the ‘Rights Contract’) for non-fulfilment of the condition relating to completion of the Unit Contract.
5. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Rights Contract in the sum of $10,000.00.
6. Orders that the first and second respondents pay the applicant’s costs of and incidental to this application to be assessed on the standard basis.

CATCHWORDS:

CONVEYANCING – RELATIONSHIP OF VENDOR AND PURCHASER - CONTRACT FOR SALE OF UNITS AND MANAGEMENT RIGHTS – TERMINATION – lawful termination of each contract – where applicant was not given a signed disclosure statement prior to entering into the unit contract – requirement to provide a disclosure statement by s206 of the Body Corporate and Community Management Act (Qld) 1997 - whether a solicitors signature constitutes effective signing for the purpose of this section - performance of the management rights contract was linked to the units contract – valid termination of unit contract means management rights contract validly terminated

Acts Interpretation Act 1954 (Qld) s48A
Body Corporate and Community Management Act 1997 (Qld) s4(a), s4(g), s206, s206(1), s206(2), s206(7), s206(8)(3), 207, s208, s209
Property Agents and Motor Dealers Act 2001 (Qld) s366B(4)

Legione v Hateley (1983) 152 CLR 406
MNM Developments Pty Ltd v Gerrard (2005) 2 QdR 515
Nowrani Pty Ltd v Brown (1989) 2 QdR 582
Sargent v…

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.

Continue reading Pazcuff Pty Ltd v Farmilo

Details

AGLC: Pazcuff Pty Ltd v Farmilo [2009] QSC 230
Case: [2009] QSC 230
Decision Date: 14 August 2009

CaseChat Overview and Summary

In the case of Pazcuff Pty Ltd v Farmilo, the dispute centred around the sale of multiple units and associated management rights. The applicant, Pazcuff Pty Ltd, sought to terminate a contract for the purchase of several units and the associated management rights, arguing that the vendors had failed to provide a signed disclosure statement as required by s 206 of the Body Corporate and Community Management Act 1997. The vendors, the respondents, contested the termination and sought to enforce the contracts.

The primary legal issues before the court were whether the disclosure statement required by the Act had to be signed by the vendor or could be signed by someone authorised by the vendor, and whether the applicant was entitled to terminate the contracts and seek the return of the deposits paid. The court had to interpret the statutory requirements under the Act and determine the effect of non-compliance on the validity of the contracts. Additionally, the court needed to decide if the termination of the unit purchase contract necessarily led to the termination of the associated management rights contract.

The court found that the first respondent did not provide a signed disclosure statement as required by the Act, and therefore, the applicant was entitled to terminate the unit contract. The court ruled that the signature required by the Act had to be that of the vendor or a person authorised by the vendor, and a signature by the vendor's solicitor did not suffice. Consequently, the court declared that the applicant had lawfully terminated the unit contract and was entitled to the return of the deposit. Given that the management rights contract was contingent upon the completion of the unit contract, the court also found that the applicant had lawfully terminated this contract and was entitled to the return of the deposit paid under it. The court ordered the respondents to pay the applicant’s costs of the proceeding.

This decision underscores the importance of compliance with statutory disclosure requirements in real estate transactions and the potential consequences of non-compliance for both vendors and purchasers. The ruling clarifies the interpretation of the statutory requirements concerning the signing of disclosure statements and the effect of non-compliance on the enforceability of real estate contracts.

Orders

Orders of the court

The Court –

1. Declares that the first respondents failed to give the applicant a disclosure statement complying or, alternatively, substantially complying with s 206(1) of the Body Corporate and Community Management Act 1997 before the applicant entered into a contract dated 5 November, 2009 for the purchase from the first respondents of Lots 11, 13, 14, 16, 17 and 21 on BUP 70791, County of Nares, Parish of Cairns, (the ‘Unit Contract’) by failing to give to the applicant a disclosure statement signed by the first respondents, or a person authorised by the first respondents, before the applicant entered into the Unit Contract.

2. Declares that the applicant has lawfully cancelled the Unit Contract pursuant to s 206(7) of the Body Corporate and Community Management Act 1997.

3. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Unit Contract in the sum of $10,000.00.

4. Declares that the applicant has lawfully terminated the contract dated 5 November 2008 for the purchase by the applicant from the second respondent of the management and letting business known as Reef Gateway Apartments (the ‘Rights Contract’) for non-fulfilment of the condition relating to completion of the Unit Contract.

5. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Rights Contract in the sum of $10,000.00.

6. Orders that the first and second respondents pay the applicant’s costs of and incidental to this application to be assessed on the standard basis.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

CITATION:	Pazcuff Pty Ltd v Farmilo & Ors [2009] QSC 230
PARTIES:	PAZCUFF PTY LTD (ACN 010 841 246) (Applicant) v PETER WILLIAM FARMILO and PATRICIA MARGARET FARMILO (First Respondents) FARMILO PTY LTD (ACN 072 008 096) (Second Respondent)
FILE NO/S:	121 of 2009
DIVISION:	Trial
PROCEEDING:	Application
ORIGINATING COURT:	Supreme Court, Cairns
DELIVERED ON:	14 August 2009
DELIVERED AT:	Cairns
HEARING DATE:	28 April 2009
JUDGE:	Jones J
ORDER:	The Court – 1. Declares that the first respondents failed to give the applicant a disclosure statement complying or, alternatively, substantially complying with s 206(1) of the Body Corporate and Community Management Act 1997 before the applicant entered into a contract dated 5 November, 2009 for the purchase from the first respondents of Lots 11, 13, 14, 16, 17 and 21 on BUP 70791, County of Nares, Parish of Cairns, (the ‘Unit Contract’) by failing to give to the applicant a disclosure statement signed by the first respondents, or a person authorised by the first respondents, before the applicant entered into the Unit Contract. *2. Declares that the applicant has lawfully cancelled the Unit Contract pursuant to s 206(7) of the Body Corporate and Community Management Act* 1997. 3. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Unit Contract in the sum of $10,000.00. 4. Declares that the applicant has lawfully terminated the contract dated 5 November 2008 for the purchase by the applicant from the second respondent of the management and letting business known as Reef Gateway Apartments (the ‘Rights Contract’) for non-fulfilment of the condition relating to completion of the Unit Contract. 5. Declares that the applicant is entitled to be repaid the whole of the deposit paid by the applicant under the terms of the Rights Contract in the sum of $10,000.00. 6. Orders that the first and second respondents pay the applicant’s costs of and incidental to this application to be assessed on the standard basis.**
CATCHWORDS:	CONVEYANCING – RELATIONSHIP OF VENDOR AND PURCHASER - CONTRACT FOR SALE OF UNITS AND MANAGEMENT RIGHTS – TERMINATION – lawful termination of each contract – where applicant was not given a signed disclosure statement prior to entering into the unit contract – requirement to provide a disclosure statement by s206 of the Body Corporate and Community Management Act (Qld) 1997 - whether a solicitors signature constitutes effective signing for the purpose of this section - performance of the management rights contract was linked to the units contract – valid termination of unit contract means management rights contract validly terminated Acts Interpretation Act 1954 (Qld) s48A Body Corporate and Community Management Act 1997 (Qld) s4(a), s4(g), s206, s206(1), s206(2), s206(7), s206(8)(3), 207, s208, s209 Property Agents and Motor Dealers Act 2001 (Qld) s366B(4) Legione v Hateley (1983) 152 CLR 406 MNM Developments Pty Ltd v Gerrard (2005) 2 QdR 515 Nowrani Pty Ltd v Brown (1989) 2 QdR 582 Sargent v…