Donal Keenan and Tara Phelan Join Cronin Litigation
Cronin Litigation is pleased to announce the recent additions to our team.
Donal joins our firm as an Associate and brings with him rich legal experience.
Admitted as a solicitor in Queensland in 2006, Donal practised for 7 years in Brisbane and, after a sojourn practising in Sydney, returned with abundant and varied litigation skills.
Donal has high level insurance litigation exposure, mainly in professional negligence matters, which complements commercial litigation experience; he has acted in disputes on both the plaintiff and defendant sides; in cases as diverse as acting for an ASX listed property developer in a multimillion dollar construction claim, to acting for a national professional services firm in a restraint of trade dispute.
In an earlier life, Donal practised as a solicitor in Ireland.
Tara joins us as a solicitor after recently being admitted to the legal profession.
Tara is a Gold Coast local. After having spent years living and studying in the United Kingdom and Ireland, she returned to the Gold Coast to complete her university studies.
Tara holds a Bachelor of Laws and a Bachelor of Psychological Science from Griffith University and a Graduate Diploma in Legal Practice from Queensland University of Technology.
Tara is a driven young lawyer who continually strives to provide high quality work while also maintaining a commercially practical result.
Donal can be contacted at: email@example.com
Tara can be contacted at: firstname.lastname@example.org
The BCIPA Reform
After much debate, the Building and Construction Industry Payments Amendment Act 2014 (Qld) (the Amending Act) was passed in Queensland Parliament on 11 September 2014.
The Act introduces amendments to the Building and Construction Industry Payments Act 2004 (QLD) ("BCIPA") which seek to create a better balance between claimants and respondents in the building and construction industry in Queensland.
The main focus of the reform revolves around the adjudication process, types of claims and new timeframes for payment.
The Key Areas of Reform
The Adjudication Process – The Queensland Building and Construction Commission (QBCC) now acts as a single adjudication registry in charge of, inertia alia, registering and appointing adjudicators. The registry is also responsible for adjudicators in so far as monitoring them, providing a list of ‘active adjudicators’ to the public, providing professional development to them and assisting them to administer the Act.
Timeframe to Make a Claim – A claim for payment must be made within 6 months (rather than 12 months) from the time the last work was carried out or the goods/services were supplied. The only exception to this rule is where the contract provides for a longer period.
Special Provision for Large or Complex Claims – If the claim is over $750,000 it will fit under the banner of ‘large’ or ‘complex’ claim. If the Payment Claim is large or complex, the Respondent will have 15 business days to pay (rather than 10 like all other Claims). Furthermore, if the Payment Claim is served after 91 days (starting from the reference date on the contract) the Respondent in a large or complex Claim will be allowed 30 business days to make payment.
Time for Adjudication Response – All Respondents have 10 business days to respond (rather than 5) after receiving an Adjudication Application. Again, if it is a large or complex Claim the Respondent will have 15 business days and the Adjudicator may allow a further extension of an additional 15 business days.
Information on Adjudication Response – Respondents can now set out their reasons for lack of payment in their adjudication response, even if the issues were not raised by the Claimant in the payment claim. Claimants can then reply within 15 business days. The Claimant may also apply to the adjudicator for an additional 15 business days if the reasons given by the Respondent are complex or high in volume. This change has occurred because, previously, Claimants could spend large periods of time preparing payment claims and the Respondent only had 10 business days to respond.
Fees of Adjudicator – The new BCIPA provides a list of considerations that an Adjudicator may take into account when deciding what fees to charge to the parties. Included in the list is whether one of the parties participated for an improper purpose or whether one of the parties acted unreasonably.
Second Chance for Respondents – If a Claimant serves a Payment Claim on a Respondent and the Respondent fails to serve a Payments Schedule and pay all or part of the Claim by the due date, the Claimant must give the Respondent notice of their intention to either start proceedings or apply for adjudication. This step must be taken before such action can proceed. The notice must allow 20 business days starting on the day after the payment fell due and state that the Respondent can serve a Payment Schedule within 5 business days after receiving the notice.
Tip for Respondents
It is important for Respondents to provide a Payment Schedule within the correct timeframe whenever they receive a Payment Claim. This is the case even if the contractor has previously stated that they will not pursue a payment claim under BCIPA because express agreements are not allowed to limit the operation of BCIPA. However, should such an event occur, the Respondent still has a second chance to lodge a Payment Schedule once served with a notice of proceedings.
In these circumstances, the Respondent will only have 5 days to create the Payment Schedule which, depending on the complexity and scale of the claim, could be time consuming and costly. It is therefore recommended that all Respondents seek legal advice and begin preparation on a Payment Schedule as soon as they are served with a Payment Claim, even if they decide to wait until after they are served with the notice of proceedings to lodge it.
The transitional provisions are relatively simple. Any construction contract that is entered into before 11 September 2014 will still be subject to the old BCIPA in regards to the recovery of payments. Even if an Adjudication application has been made before the amendments and the decision has still not been made after the amendments, the old BCIPA will still apply to the decision.
The only part of the new BCIPA that will apply to contracts before its commencement are the changes relating to the functions of the ANA’s (Authorised Nominating Authority’s). Simply put, the functions of the ANA’s have been transferred to the registrar.
An element of training and education has been implemented into the transitional provisions by giving the Registrar the power to impose a condition on the registration of Adjudicators. The only condition that the Registrar can impose is the condition that the Adjudicator completes “transition training”. This condition can only be imposed within the first 6 months after the commencement of the Act in order to facilitate a smooth transition to the new provisions.
In general, the reforms create a more equitable system and should reduce Adjudication costs for parties. They take account of complex claims and look to boost the interests of Respondent’s, which were previously stifled in comparison to Claimants.
The amendments add a layer of complexity to the industry so it is important that both Claimants and Respondents obtain legal advice to ensure compliance. The legal industry can assist compliance by shifting focus to concentrate on timeframe identification and creating new construction contracts that are drafted with the BCIPA amendments in mind.
Should you require assistance with your building or construction dispute, contact Cronin Litigation Lawyers on (07) 5592 6633
Cronin Litigation says 'Thanks for the Support'
A number of staff from Cronin Litigation Lawyers recently participated in the 10km run at the Gold Coast Marathon.
Thanks to the support of clients, friends and colleagues we have raised almost $4,000.00 for OzHarvest.
OzHarvest is a food rescue charity that collects excess food from cafes, delis, supermarkets and restaurants and delivers it to some 80 charities within South East Queensland who then feed those in need. To learn more about OzHarvest, please click the following link:
Derek Cronin to speak at Australian Marriage Equality Function
Australian Marriage Equality is visiting the Gold Coast on the weekend of 12 to 14 September 2014.
Derek, a strong supporter of Marriage Equality, has agreed to assist Australian Marriage Equality in holding a business meeting to be held at Bond University on the 12th September. Derek will be introducing Shelly Argent (the President of PFLAG) and also Rodney Croome (the National Director of Australian Marriage Equality).
The aim of the meeting is to show community support to the notion that it is time for legislative change nationally.
Many business leaders of the Gold Coast have already expressed their support and have indicated that they will be attending.
For more information, please contact Derek Cronin on (07) 5592 6633 or email@example.com
Cronin Litigation Raises Money for OzHarvest
In 2014, a number of staff from Cronin Litigation Lawyers will be running together in the Gold Coast Marathon 10km run to raise money for OzHarvest.
OzHarvest is a food rescue charity that collects excess food from cafes, delis, supermarkets and restaurants and delivers it to some 80 charities within South East Queensland who then feed those in need.
In support of OzHarvest, and to give us all some motivation for the Marathon, we have set up a Cronin Litigation Lawyers team fundraising page where you can donate and assist with this great cause.
OzHarvest and Cronin Litigation Lawyers are grateful for your donations.
To donate, please click the link below:
To learn more about OzHarvest, please click the following link:
Stacy Miller Appointed as Partner of the Firm
We are pleased to announce that Stacy Miller has been appointed as a partner of the firm effective 19 February 2014.
Stacy has practised exclusively in the areas of commercial litigation, insolvency, debt recovery and dispute resolution since her admission as a solicitor of the Supreme Court in January 2003.
Stacy has been with the firm for over two years following previous employment as a solicitor in specialist litigation firms in Brisbane. Having moved to the Gold Coast with her family, she is well and truly entrenched in the Gold Coast community and her appointment as a partner is an acknoweldgement of the signifcant role she holds with the team of seven lawyers at Cronin Litigation.
We congratulate Stacy on her appointment.
Cronin Litigation Lawyers Raises Money for Homeless Youth
A number of staff from Cronin Litigation Lawyers recently participated in various events of the Gold Coast Marathon including the 7.5km challenge, the 10km run and the half marathon.
At Cronin Litigation we understand the importance of volunteers on the Gold Coast, and the active role they play in making our city a great place to live, that is both safe and progressive.
Thanks to the support of clients, friends and associates, the efforts of the team raised over $5,000.00 for the benefit of the Gold Coast Project for Homeless Youth. The Gold Coast Project for Homeless Youth Inc, established in 1984, provides supported accommodation across three houses for young people aged 16 to 19. A Mobile Support team also provides services for young people to secure and sustain stable accommodation. The aim of the Gold Coast Project for Homeless Youth is to break the cycle of homelessness and encourage young people to reach their full potential.
For more information concerning the Gold Coast Project for Homeless Youth, please visit www.homelessyouth.com.au.
Gold Coast Marathon
Cronin Litigation Lawyers are participating in the Gold Coast Marathon 2013.
This year, members of the firm are running in the full marathon (over 42km), the 10km event and the 5.7km challenge.
At Cronin Litigation we understand the importance of volunteers on the Gold Coast, and the active role they play in making our city a great place to live, that is both safe and progressive.
In 2013, the Cronin Litigation marathon participants will be running for the Gold Coast Project for Homeless Youth. The Gold Coast Project for Homeless Youth, established in 1984, provides supported accommodation across three houses for young people aged 16 to 19. A Mobile Support team also provides services for young people to secure and sustain stable accommodation. The aim of GCPHY is to break the cycle of homelessness and encourage young people to reach their full potential.
In 2012, Cronin Litigation raised over $3,500.00 for the Second Chance Programme, which also provides assistance to homeless women of Queensland. This year we hope to exceed that figure obtained in 2012. GCPHY and Cronin Litigation are grateful for your donations and the motivation that your donations will give us to keep running!
The link to our fundraising page is here: http://www.everydayhero.com.au/Cronin_Litigation_Lawyers_2013
Appointment of Associates
Cronin Litigation Lawyers are pleased to announce the appointment of Mia Kershaw as Senior Associate and Melissa Coleman as Associate to the firm.
Mia has a career spanning more than nine years on the Gold Coast and Brisbane, with over seven years experience in litigation and dispute resolution.
Melissa has been practicing exclusively in commercial litigation since becoming admitted as a solicitor, and has continued since joining Cronin Litigation in 2011.
Derek and the Cronin Litigation team congratulate both Mia and Melissa on their new roles.
Mia and Melissa can be contacted on (07) 5592 6633 or as follows:-
Mia Kershaw: firstname.lastname@example.org
Melissa Coleman: email@example.com
Adjudicator Erred in Building Dispute
The parties to the proceeding were engaged in a building dispute in relation to a Period Subcontract and appointed an adjudicator under the Act to resolve the dispute. The adjudicator’s decision dumbfounded Matrix Projects (Qld) Pty Ltd (“Matrix”) and an application was brought forward to review the decision.
Matrix took a two-pronged approach to attack the adjudicator’s decision, stating the adjudicator erred on a question of law and failed to correctly execute his powers.
Among other things, the adjudicator was asked to review a Payment Claim made by Jason Luscombe trading as Luscombe Builders (“Luscombe”) under section 17 of the Act. The Payment Claim was in relation to rectification work carried out by Luscombe under the Period Subcontract. The Payment Claim included rectification work from 14 separate projects all in the one claim. Out of the 14 rectification projects, 9 were performed after work orders were issued to Luscombe pursuant to the Period Subcontract, while the remaining 5 jobs were performed after Luscombe received verbal instructions from Matrix.
The adjudicator believed all of these rectification jobs were performed under one Construction Contract as defined by the Act. The adjudicator argued that the series of projects performed by Luscombe all occurred pursuant to one arrangement. The adjudicator made reference to a term in the subcontract that stated Luscombe builders would “perform and complete… Works yet to be agreed” and took the view that this meant any work performed after the commencement of the Period Subcontract, was done so under this one arrangement. As such, the adjudicator believed all the jobs were performed pursuant to a single construction contract.
Matrix argued, and the Court agreed, that the adjudicator erred in correctly applying the Act. The Court stated that the term “arrangement” could not include works performed under a Period Subcontract and works performed pursuant to verbal instructions (referred to as “do and charge” works). Matrix claimed do and charge works were entirely different to works performed pursuant to Work Orders issued under the Period Subcontract. The Court decided the works were in fact entirely separate and therefore found there was more than one construction contract incorporated into the Payment Claim. As a result the Court found that the Payment Claim did not conform to the requirements of the Act, namely section 12 and 17 of the Act, which requires a payment claim to relate to only one construction contract.
In addition, the Court found the adjudicator failed in exercising his powers. The Adjudicator is required by the Act to calculate the value of construction work performed by Luscombe under the Contract. Instead of performing this task, the ajudicator calculated the value of all work Luscombe was given under the Contract including work not yet completed and work that Matrix terminated.
Further the adjudicator stated in his decision that Luscombe was entitled to receive damages for any loss of income suffered by terminating work under the Contract. The Court found the adjudicator’s reasoning for damages flawed and unintelligible and stated the adjudicators calculations were erroneous as he failed in performing the simple task required by the Act.
The Court found that the adjudicator’s decision was void because the adjudicator failed to perform the task required of him by the Act, the adjudicator failed to accord to natural justice and because the payment claim covered more than one construction contract.
This case is a timely reminder that:-
- Substance over form does not apply when lodging Payment Claims under the Act; and
- Adjudicator’s decisions are never final.
Cronin Litigation Lawyers are currently assisting many clients with building disputes and reviewing adjudicator’s decisions. If you have a building dispute or are unhappy with the outcome of adjudication, please phone our offices on (07) 5592 6633 to find out how we may be of assistance.
Andrea Joyce joins Cronin Litigation Lawyers
Nathan Symes joins Cronin Litigation Lawyers
Nathan joined Cronin Litigation Lawyers as a Solicitor in November 2012, having previously worked with a Commercial and Property law firm based on the Gold Coast.
Admitted as a Solicitor in the Supreme Court of Queensland, Nathan completed his Bachelor of Laws and Graduate Diploma of Legal Practice at Bond University. Originally from Brisbane, Nathan has called the Gold Coast home for the last seven years. During this time he has fostered valuable industy relationships and developed an in-depth understanding for the nuances and specific needs his clients require.
Nathan's areas of practice include:-
- Commercial Litigation;
- Debt Recovery, Bankruptcy and Insolvency;
- Property Disputes and Litigation;
- QCAT Litigation;
- Body Corporate Building Disputes.
Nathan is committed to developing and maintaining strong client relationships and providing a high level of service while ensuring matters are handled effeciently and cost effectively.
In his spare time, Nathan enjoys good food, good company and motorsport.
Facebook: How to Serve a Super-Star
Protecting your Interests in Personal Property after Registration
In the first Court decision since the proclamation of the Personal Property Securities Act (PPSA), the Federal Court in Carson, in the matter of Hastie Group Limited (No 3)  FCA 719 (5 July 2012) ("Hastie") has illustrated that protecting your property interests may require more than mere registration on the Personal Properties Security Register (PPSR).
Administrators appointed to a number of companies that comprise the Hastie Group applied to the Court for permission to dispose of plant and equipment held by various companies in the Hastie Group across 36 different locations. The total estimated auction value of the plant and equipment was $6.4 million.
There were 995 registrations recorded against the companies in the PPSR. The administrators sent letters to all creditors who had an interest recorded against the companies on the PPSR. Each creditor was requested to provide notification of its interest. Approximately 80% of those secured creditors did not respond to the letter and the responses received by administrators did not adequately particularise the relevant property or security agreement. Administrators had great difficulty identifying property that is subject to the security interests of third parties. To add to the complexity, property had been relocated to various sites owned by the Hastic Group making it difficult to identify the location of property belonging to creditors. Additionally, administrators had difficulty relying on the PPSR for the purpose of identifying property subject to security interests of third parties because many of the descriptions were too general.
At the time of the decision, approximately 3684 items of plant and equipment remained "unclaimed". The ongoing storage and maintenance of that plant and equipment represented a significant cost to administrators. The Court was satisfied that there had been genuine and substantial difficulties in identifying those items of plant and equipment that might be subject to a security interest and other claims, and that the administrators had taken a number of steps to attempt to identify security holders. The Court allowed the administrators to sell the unclaimed plant and equipment by public online auction. The proceeds of sale were then to be held in a separate account to be distributed first towards the payment of administrators' costs incurred in the sale, second towards any claim in respect of the unclaimed property and finally, after a period of three months, the balance would be distributed in the ordinary course of the administration.
The decision in Hastie serves as a warning to creditors that they should actively take steps to protect their property interests beyond mere registration on the PPSR. We recommend that creditors:
- Register security interests on the PPSR including security interests created before 30 January 2012 (transitional security interests);
- Provide an accurate description for each item of secured property and particularise as much detail as possible to enable administrators to identify the property;
- Attach labels, name plates or serial numbers to property to distinguish it from property belonging to other creditors and to assist administrators trying to identify it;
- Have a system in place to track or record the location of property;
- Monitor the status of customers and other businesses (i.e. whether insolvent);
- If a customer is under administration, take steps to contact the administrator to notify them of your secuity interest;
- Respond to such requests from administrators within the stipulated time and particularise, in as much detail as possible, the relevant property and the security agreement under which the security interest was granted;
- If you currently have an interest in property concerning any of the companies within the Hastie Group, contact us or the liquidators immediately for advice on how you should proceed with the enforcement of your interest.
Cronin Litigation Lawyers comprises lawyers who are dedicated to protecting and enforcing interests in personal property. Our team has in-depth experience in dealing with companies under administration and in liquidation. If you are seeking to protect or enforce your interest in personal property, please contact Derek Cronin at Cronin Litigation Lawyers on (07) 5592 6633 to find out how we may be of assistance.
Fair Entitlements for Employees
On 5 December 2012, the Fair Entitlements Guarantee Act (2012) (FEG) came into effect. This act will apply to employees whose employment ends as a result of their employer entering liquidation or bankruptcy from 5 December 2012 forward. The previous scheme, known as the General Employee Entitlements and Redundancy Scheme (GEERS) will still apply to employees whose employment ends due to an insolvency event that occurs prior to 5 December 2012. As opposed to GEERS, the Fair Entitlements Guarantee Act enshrines the right to payment of outstanding entitlements in legislation, and strengthens these rights in certain respects.
In the main, the FEG replicates the assistance provided through the previous GEERS administrative scheme, providing for the advance of the following unpaid employee entitlements by the Commonwealth Government to the employee in the event the employer enters liquidation or bankruptcy:
Wages (up to 13 weeks)
Long service leave
Payment in lieu of notice (up to five weeks), and
Redundancy pay (up to four weeks per year of service).
However the operation of the FEG Act differs in some respects from GEERS. The following is a summary of some of the main provisions of the Act, and where they differ from GEERS.
Timeframe to lodge a claim
The FEG provides that an effective claim for assistance may only be lodged within 12 months of the date of liquidation or bankruptcy, or the end of employment (whichever is later). There is no flexibility to extend this timeframe. If a claim is received outside this timeframe (whether lodged directly with the department or by an insolvency practitioner on behalf of the claimant), the claimant will not be eligible for assistance. Note that GEERS provided some discretion to extend this timeframe; however, the FEG Act does not.
Under the FEG claimants must be an Australian citizen or the holder of a permanent or special category visa (under the Migration Act 1958) at the time their employment ended. There is no flexibility with this time requirement under the FEG Act. Under GEERS a claimant was eligible if they met residency requirements within 12 months of liquidation or the end of employment.
Deed of Company Arrangement (DoCA) and equivalent bankruptcy arrangements such as Personal Insolvency Agreements
The FEG does not include eligibility requirements relating to DoCAs and equivalent bankruptcy arrangements. Provided that all other eligibility criteria are met, assistance will be paid to employees. Under GEERS eligibility rested on whether the DoCA met certain requirements in relation to maintaining provisions of the Corporations Act 2001 relating to priority of employee entitlements and distribution of funds.
Assistance paid to end of employment.
Under the FEG, where an employee continues to be employed after an insolvency practitioner is appointed, assistance is also payable for any entitlement or proportion of entitlement that accrues or crystallises during that employment, provided that the insolvency practitioner is not legally responsible to pay the entitlement as part of the cost of wind up the company. Put simply, under the FEG the entitlement is calculated up to the end of employment, less any portion required to be paid by the insolvency practitioner as a cost of winding up. Under GEERS entitlements were only calculated up to the date of appointment of the insolvency practitioner.
Transfer of Business and Transfer of Employment
Initially there is no change. However, from 1 July 2014, the FEG will no longer impose a flat rule that entitlements for payment in lieu of notice (PILN) and redundancy are not payable if the employee is offered employment by the new operator within 14 days of their employment ending with the previous operator. From 1 July 2014, assessment of entitlements payable in transfer of business cases will be based on the provisions of the claimant’s governing or employment instrument, such as the Fair Work Act 2012. Generally, this means that payments will only be excluded under the FEG where the new operator is required to recognise the employee’s service and entitlements.
Discretion within the scheme
As the FEG is a legislative scheme any discretionary decisions are closely prescribed in terms of the circumstances and conditions under which discretion may be exercised. Under the FEG, discretion can only be used for uncommon circumstances to:
Allow payments to be made to employees of a company in administration before liquidation provided there is a high degree of certainty that liquidation will occur in the future and there is a public interest in facilitating early access to the scheme;
Make a regulation establishing a separate scheme to provide assistance for workers that are not employees; i.e. contractors
Paying FEG assistance by way of an instalment.
It should be noted that these areas of discretion should not be initiated by an insolvency practitioner as a usual approach in administration. This differs considerably from GEERS, in that GEERS is an administrative scheme, and as such, has flexibility for discretion to be exercised to allow claims that meet the objectives of the scheme.
Rights of Review
The FEG provides three avenues of review:
Under s.37 the department may initiate a review of a decision – it is expected that this avenue would be used to reassess claims where convincing new evidence has been provided or there is an anomaly in the original decision;
Under s.38 the claimant may make a formal request for the department to review a claim decision; and
Under s.40 the claimant may apply for an external review by the Administrative Appeals Tribunal (noting this option is only available where the claimant remains dissatisfied with an outcome to a s.38 review).
Under GEERS there was no avenue for external review of a claim decision.
The FEG Act clarifies the current arrangements for the payment of employee entitlements on the insolvency or bankruptcy of their employer, and puts these arrangements on a more secure constitutional footing.
From the point of view of employees, more generous provisions relating to redundancy payments and some additional flexibility in relation to payment arrangements will be welcomed. From the point of view of other creditors of the employer, more certainty should also be beneficial.
Cronin Litigation can assist with lodging a claim under the FEG Act. Our staff will outline the process in an easy step by step manner and ensure that your entitlements are acknowledged and protected in the event your employer enters liquidation or bankruptcy.
Decisions Highlight Consumer Law
Recent decisions on alleged misrepresentations by sellers and their agents have forced real estate agents, conveyancing solicitors, litigators and developers to take notice.
Decisions in Queensland’s Supreme Court and District Court have challenged long-standing consumer protection and misrepresentation precedents entrenched in state property law.
This article provides a brief summary of the decisions and their impact on current litigation and the property landscape.
In October 2011, the Supreme Court of Queensland delivered its decision in Nifsan Developments Pty Ltd v Buskey & Anor  QSC 314 (Applegarth J 27/10/2011) in which deposits were successfully returned to buyers after the contract for the purchase of a penthouse apartment in Nifsan’s Emerald Lakes development was found to be void as a result of representations made by the developer’s agent.
The representations regarding views were found to be misleading and deceptive – terms used in the sections 52 and 53A of the Trade Practices Act 1974 (Cth) (now called the Competition and Consumer Act 2010, but the TPA still applies to acts or admissions prior to 1 January 2011 pursuant to section 6 of schedule 7 of the Trade Practices Amendment (Australia Consumer Law) Act (No.2) 2010 (Cth)).
In December last year, and in stark contrast to the decision in Nifsan, the Supreme Court delivered the decision in a number of claims against Oracle developer South Sky Investments Pty Ltd. In South Sky, eight individual purchasers sought to terminate their off-the-plan contracts, alleging various breaches of the Body Corporate and Community Management Act 1997 (Qld) (BCCM Act) by the developer, the primary assertion being a failure to disclose that the Oracle would be operated by the Peppers chain of resorts and hotels.
The plaintiffs in South Sky asserted that each had contracted to purchase an apartment in ‘The Oracle’, whereas each apartment in question was now in a hotel or resort branded by Peppers. The plaintiffs maintained that, on completion of the Oracle development, the purchasers were receiving a substantially different product than what they had contracted to purchase.
Ultimately, the purchasers failed in their claims against South Sky on the basis that the contracts implied that the apartments would be in a residential, not commercial, precinct as opposed to the strict interpretation of the term ‘residential’ being owner-occupier or long-term rental.
A recurring subject throughout the South Sky decision was that the applicants had failed to establish their pleaded case of inaccuracy (of the BCCM Act statements) and the inaccuracy found was not shown to be causative of material prejudice. The prejudice suffered by the applicants was because the contracts did not give protection to their expectations.
The importance of an accurately pleaded claim or defence was a significant theme within Applegarth J’s judgment (at paragraphs 285 and 351). His Honour also reminded the parties and litigants that the purchasers ought to have the evidence to support the allegations of misrepresentation and reliance.
The court placed more significance on the actual written terms of the contracts rather than the intention (or expectations) of the purchasers. By still delivering the purchasers with ‘an apartment’ in a ‘residential’ complex, the developer had substantially fulfilled its obligations under the contracts. On that basis, the purchasers were held not to have repudiated the contracts as there had been no breach of a material term of the contracts which would give rise to the purchaser's right to terminate. Had the purchasers sought to rely on the expectations placed on them, then they ought to have had those expectations written into the contracts.
The buyers in South Sky appealed Applegarth’s decision to the Queensland Court of Appeal. On 15 June 2012, their Honors McMurdo M, Muir and Wilson M dismissed the buyers’ appeal with indemnity costs in favour of South Sky.
The decision in South Sky will undoubtedly have off-the-plan buyers nervous about their position in respect of other developments in Queensland. Many developers expected buyers to complete their contracts throughout 2011, with many buyers refusing or failing to do so.
It is clear from these recent decisions that each matter will be taken on a case-by-case basis. Accordingly, it is imperative that your claim (or counterclaim) is impeccably prepared and that your evidence is strong enough to stand up in court.
In Nifsan, the court was persuaded by the evidence put forth by the buyers (and even that of the developer’s agent) whereby it was clear that the representations had been made, the buyers relied on those representations and the representations were made by the agent on behalf of the developer in circumstances where the developer had knowledge that those representations were false and made with the intention to mislead.
The decisions also have far-reaching impacts for conveyancing solicitors and advisory firms. If your clients intend to sign, or have recently signed, a contract for an off-the-plan unit in a development, the South Sky decision goes so far as to say that any and all representations concerning the buyer’s expectations for the development ought to be written into the contract.
Despite the South Sky decision, developers must ensure that they and their agents comply with the provisions of the Competition and Consumer Act 2010 (Cth) with respect to misleading and deceptive conduct and unconscionable conduct in the procurement of off-the-plan sales.
With the hearing of numerous claims in the District Court and Supreme Court throughout the state, it is certainly an interesting and exciting time for the development of property law and commercial litigation in Queensland.
Cronin Litigation Lawyers are currently acting for many buyers of off-the-plan residential units and houses on the Gold Coast and the greater Brisbane region. If you have purchased an off-the-plan property, please contact Melissa Coleman at Cronin Litigation Lawyers on (07) 5592 6633 to find out how we may be of assistance.
Melissa Coleman appointed to the Commitee of Young Professionals Gold Coast
Cronin Litigation Lawyers are proud to announce the appointment of Melissa Coleman as Secretary of Young Professionals Gold Coast.
Young Professionals Gold Coast are a non-profit association providing a platform for Gold Coast's young professionals to meet, mingle and build relationships. Cronin Litigation Lawyers are proud to sponsor the Young Professionals team and look forward to the rapid growth of the organisation. Young Professionals Gold Coast regularly hold social and networking events with inspiring and motivating key-note speakers.
If you are interested in attending the Young Professionals Gold Coast events, or sponsoring the association, please contact Melissa Coleman on (07) 5592 6633 or visit www.ypgc.com.au
Derek Cronin Speaks at Networking Night for Blair Harding - Action Coach
On 1 August 2012, Derek Cronin attended a networking function run by Blair Harding. Blair Harding is a business coach with a very successful practice on the Gold Coast and beyond.
Derek spoke of the importance of crafting effective letters of demand and also discussed debt recovery options including statutory demands and the use of the Queensland Civil Administrative Tribunal.
The event was held at Hotel QT which is fast becoming a popular establishment on the Gold Coast.
For further information regarding Blair Harding, please see www.actioncoach.com
Cronin Litigation Raises Money for Homeless Women
A large contingent from Cronin Litigation recently participated in the Gold Coast Marathon (well actually, the 10 kilometre run which was held during the Gold Coast Marathon!).
Thanks to the support of clients, friends and associates, the efforts of the team raised more than $3,000.00 for the benefit of Second Chance Programme, a fundraising group which provides funds to homeless women throughout Queensland. Pictured are four members of the team, Shaun Rose, Mia Kershaw, Melissa Coleman and Chloe Rushby.
For information concerning Second Chance Program, please visit www.secondchanceprogramme.com.au
BMD Northcliffe Surf Lifesaving Club
Cronin Litigation is pleased to continue its longstanding support of the BMD Northcliffe Surf Lifesaving Club.
Pictured above is Shannon Eckstein, three time World Iron Man Champion, David Shields, President of Northcliffe, and Derek Cronin of Cronin Litigation Lawyers.
New Office for Cronin Litigation
Construction of our new office has been completed and we are now located at Level 2, 33 Elkhorn Avenue, Surfers Paradise. The move has been necessary to accommodate the significant growth experienced by the firm.
The design of the new office was completed by Paul Ziukelis, Architect, the construction by Better Build Construction and interior design by Toni Packer. The design of the office is unique and especially planned to accommodate a modern, boutique law firm.