Vouzas v Bleake House Pty Ltd - [2013] VSC 534

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMERCIAL AND EQUITY DIVISION

S CI 2010 5307

STEVEN VOUZAS & ANOR	Plaintiff
v
BLEAKE HOUSE PTY LTD & ANOR	Defendant

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JUDGE:	MACAULAY J
WHERE HELD:	Melbourne
DATE OF HEARING:	6-8, 12-14 March 2013
DATE OF JUDGMENT:	8 October 2013
CASE MAY BE CITED AS:	Vouzas v Bleake House Pty Ltd
MEDIUM NEUTRAL CITATION:	[2013] VSC 534

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TRADE PRACTICES – Misleading or deceptive conduct – Representations made by vendor and vendor’s selling agent when selling land – Representations about long term lease to AAA tenant – Conduct comprising written and oral representations, and silence about agreement to sell lease – Importance of clear identification of conduct alleged to be misleading and deceptive – Conduct of defendants not misleading or deceptive or likely to mislead or deceive – No loss caused by conduct – s 52 Trade Practices Act 1974 (Cth).

SALE OF LAND – Whether a conditional transfer of lease is required to be disclosed under s 32(2)(b) of the Sale of Land Act 1962 (Vic) – Disclosure not required by Act – Defence under s 32(7) made out in the alternative.

CONTRACT – Counterclaim for damages caused by breach of contract of sale of land – Whether damages to be measured at time of breach or at a later time – Johnson v Perez (1988) 166 CLR 351; Wroth v Tyler [1974] Ch 30.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	G McCormick	Goldsmiths Lawyers
For the First Defendant	M Osborne	O’Donnell Salzano Lawyers
For the Second Defendant	L Nichols	DLA Piper Australia

TABLE OF CONTENTS

Introduction......................................................................................................................................... 1

Statement of issues........................................................................................................................ 3

Claim.......................................................................................................................................... 3
Counterclaim.............................................................................................................................. 4
Third party claims...................................................................................................................... 4

Factual background........................................................................................................................... 4

Was Vouzas/Baia Properties entitled to rescind the contract?................................................. 12

What did s 32(2)(b) require to be disclosed?.......................................................................... 14
False or incomplete information?............................................................................................. 15
Conclusion on application of s 32 of the Sale of Land Act...................................................... 20

Was the conduct of Bleake House and/or Keleman Commercial misleading or deceptive? 22

What was the conduct alleged?................................................................................................ 23
Applicable principles................................................................................................................. 27
What was said to be misleading and deceptive about the representations?..................... 29
What oral representations were made?................................................................................... 31

‘Rumour’ and ‘no truth in it’ representations.......................................................................... 31
Retail Leases Act representations............................................................................................. 41
Summary of oral representations.............................................................................................. 43

Conclusion on what comprised the impugned conduct....................................................... 46
Was the impugned conduct misleading and deceptive?..................................................... 47

Was Kelemen Commercial knowingly concerned in any breach of s 52 by Bleake House? 49

Did any contravention of s 52 cause loss to Vouzas?................................................................ 50

Knowledge of the prospect that Munday would be tenant................................................. 51
Vouzas’ inability to obtain finance to settle............................................................................ 52
Conclusion on causation............................................................................................................ 53

Contributory fault, proportionate liability and third party claims......................................... 54

Bleake House’s counterclaim......................................................................................................... 54

Applicable principles................................................................................................................. 55
The facts........................................................................................................................................ 58
Analysis and conclusion............................................................................................................ 60

Conclusion and orders.................................................................................................................... 61

HIS HONOUR:

Introduction

In the course of selling ‘The Beach’ hotel in Albert Park, Victoria, in the latter half of 2008, the vendor (or the real estate…

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: [2013] VSC 534
Decision Date: 8 October 2013

CaseChat Overview and Summary

In the matter of Vouzas v Bleake House Pty Ltd, the plaintiff, Vouzas, sought relief against the defendants, Bleake House Pty Ltd and others, for misleading or deceptive conduct and breaches of contract related to the sale of land. The case was heard in the Federal Court of Australia. Vouzas alleged that the defendants had engaged in misleading or deceptive conduct by making representations about a long-term lease to a tenant, AAA, when selling the land. Additionally, Vouzas claimed that the defendants had failed to disclose a conditional transfer of the lease, as required under the Sale of Land Act 1962 (Vic). The defendants denied the allegations and counterclaimed for damages due to a breach of the contract of sale of land.

The primary legal issues before the court were whether the conduct of the defendants was misleading or deceptive under the Trade Practices Act 1974 (Cth), and whether a conditional transfer of the lease needed to be disclosed under the Sale of Land Act 1962 (Vic). Furthermore, the court had to determine the appropriate measure of damages for the alleged breach of contract. The court examined the written and oral representations made by the defendants, as well as their silence about the agreement to sell the lease, to ascertain if they were misleading or deceptive. The court also considered the implications of Johnson v Perez (1988) 166 CLR 351 and Wroth v Tyler [1974] Ch 30 in determining the appropriate measure of damages.

The court found that the defendants' conduct was not misleading or deceptive, as the representations made and the silence did not create a false impression or cause any loss to the plaintiff. The court held that the conduct of the defendants did not contravene section 52 of the Trade Practices Act 1974 (Cth). Furthermore, the court held that there was no requirement under section 32(2)(b) of the Sale of Land Act 1962 (Vic) to disclose a conditional transfer of the lease. The court also found that the defence under section 32(7) of the Act was made out in the alternative. Finally, the court ruled that the damages for the breach of contract should be measured at the time of the breach, in accordance with the principles established in Johnson v Perez and Wroth v Tyler.

The court dismissed the plaintiff's claims and ordered the plaintiff to pay the defendants' costs. The court also dismissed the defendants' counterclaim for damages, finding that no loss had been caused by the breach of contract.

Orders