Yu v United Property Specialists Pty Ltd - [2013] QCAT 171

CITATION:

Yu & Anor v United Property Specialists Pty Ltd & Anor [2013] QCAT 171

PARTIES:	Tsun-Chin Yu (First Applicant) Kuan-Yao Chen (Second Applicant)
v
United Property Specialists Pty Ltd (First Respondent) Mr Steven Chen (Second Respondent)

APPLICATION NUMBER:

OCL113-12

MATTER TYPE:

Other civil dispute matters

HEARING DATE:

On the papers

HEARD AT:

Brisbane

DECISION OF:

Mr David Paratz, Member

DELIVERED ON:

17 April 2013

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 $52,000.00.

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 $52,000.00 from the Claim Fund, and if there is an appeal, payment must not be made until the appeal is finally decided.

3. Pursuant to section 488(3)(c) of the Property Agents and Motor Dealers Act 2000 the Respondents United Property Specialists Pty Ltd (Deregistered) and Steven Chen 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, United Property Specialists Pty Ltd (Deregistered) and Steven Chen are jointly and severally liable to reimburse the Claim Fund by paying the sum of $52,000.00 to the Chief Executive, Department of Justice and Attorney-General

CATCHWORDS:

Real estate agent – deposit received – contract not forwarded to Vendor’s solicitor – contract terminated – agent withdrew deposit personally – claim against the fund

Property Agents and Motor Dealers Act 2000

APPEARANCES and REPRESENTATION (if any):

This matter was heard and determined on the papers pursuant to s 32 of the Queensland Civil and Administrative Tribunal Act 2009 (QCAT Act).

REASONS FOR DECISION

Mr Steven Chen was a real estate agent operating on the Gold Coast under the name United Property Specialists.
Mr Kuan Yao Chen was a Taiwanese citizen who wanted to immigrate to Australia. He wanted to buy a residential property on the Gold Coast together with his mother Tsun Chin Yu.
An affidavit by Mr Kuan Chen dated 18 July 2012 deposes to the following events:-
(a)On 29 September 2011 Mr Steven Chen showed Mr Kuan Chen a unit for sale. It was Unit 31901 at 5 Lawson Street, Southport. He agreed to buy it for $520,000.
(b)A Contract for Sale was prepared by the Vendor’s agent and signed by Mr Kuan Chen.
(c)Mr Steven Chen then went to Taiwan and met with Ms Tsun Chin Yu who signed the Contract on 3 October 2011. She remitted the deposit of A$52,000 from her bank, the Bank of Taiwan, to the account of United Property Specialists Pty Ltd at Macquarie Bank, Creek Street, Brisbane.
(d)Mr Steven Chen did not forward the contract to the buyer’s Solicitor on the Gold Coast, or to the Vendor.
(e)On 7 February 2012 Steven Chen sent a text to Ms Tsun Chin Yu saying that he would terminate the contract and return the $52,000 deposit.
(f)No monies were repaid by Mr Steven Chen.
Ms Yu and Mr Kuan Chen claimed upon the fund for the deposit monies.
The Chief Executive referred the claim to the Tribunal for determination pursuant to s 488 Property Agents and Motor Dealers Act 2000 (the Act).
The Office of Fair Trading has obtained bank statements from Macquarie Bank which indicate that on 4 October 2011 the sum of $51,980 was deposited into the account of United Property Specialists Pty Ltd, and that a cheque for $48,000 made out to Steven Chen was drawn on 10 October 2011.
The Chief Executive forwarded a copy of the claim and supporting documentation to Mr Steven Chen’s last known address on 14 August 2012, but received no response.
The Chief Executive submits that the applicants have demonstrated a claimable financial loss of $52,000.
The applicants have also claimed $800 for legal fees, but the Chief Executive submits that as the legal costs can not be itemised against the court Scale of Costs, that they are not claimable from the fund.
Searches disclose that the sole director and secretary of United Property Specialists Pty Limited from 8 February 2000 to 27 June 2011 was Steven Chen. The company was deregistered on 27 June 2011.
The company was therefore deregistered at the time that Mr Steven Chen received the deposit.
Section 601AD(1) of the Corporations Act 2000 (Cth) provides that a company ceases to exist on deregistration. The property of a deregistered company vests in the Australian Securities and Investments Commission (ASIC).
A company may be reinstated under s 601AH of the Corporations Act. Under s 601AH(5) if a company is reinstated, the company is taken to have continued in existence as if it had not been deregistered.
Section 490(2)(b) of the Act provides that every person who was an executive officer of the corporation when the relevant event happened is a liable person. As Steven Chen was an executive officer of the company, he would be a liable person by operation of that section, if the company had existed at the time of the relevant event
However, as the company had ceased to exist at the time of the event, then the automatic provision of s 490(2)(b) may not apply, unless the company is reinstated.
Section 490(1)(a) provides that the Tribunal can name in its order a person (the responsible person) as being liable for a claimants financial loss.
The financial loss arose because of the actions of Steven Chen. At the time he was purporting to act as an officer of the company. If the company is not liable as it did not exist at the time, then Mr Steven Chen would assume personal liability under normal operation of law for breach of warranty of authority. I therefore consider that he can be named as a responsible person.
The situation of the company is more complex. The company may have assets, so an avenue of recovery against it may be of value. The Chief Executive may have to have seek a court order in conjunction with ASIC, or apply for reinstatement of the company, in order to proceed.
The Chief Executive has proposed that an order be made against the company as a liable person, and that the deregistration be noted on the Order in the interest of recovering a debt from it. I am prepared to accede to this proposal as the company would have been a liable party if it were still registered by virtue of its operation of the Trust Fund, and it will be a matter for the Chief Executive to effect such a recovery against the deregistered company
No material has been provided in relation to the claimed legal fees of $800, and I therefore will not allow them.
I am satisfied on the balance of probabilities that Tsun Chin Yu and Kuan-Yao Chen are entitled to claim against the fund under the Act for the amount of $52,000.00, and that United Property Specialists Pty Ltd (Deregistered) and Steven Chen are liable persons under the Act.
Accordingly, I order as follows:-
1.Pursuant to section 488 of the Property Agents and Motor Dealers Act 2000, the claim is allowed in the sum of $52,000.00.
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 $52,000.00 from the Claim Fund, and if there is an appeal, payment must not be made until the appeal is finally decided.
3.Pursuant to section 488(3)(c) of the Property Agents and Motor Dealers Act 2000 the Respondents United Property Specialists Pty Ltd (Deregistered) and Steven Chen 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, United Property Specialists Pty Ltd (Deregistered) and Steven Chen are jointly and severally liable to reimburse the Claim Fund by paying the sum of $52,000.00 to the Chief Executive, Department of Justice and Attorney-General.