Author: baron + associates

In the recent case of Kurmond Homes Pty Ltd v Marsden [2018] NSWCATAP 23, NCAT highlighted that monetary orders may be made in place of work orders even where a work order is preferred by the offending party. In this case, KH was appealing an order to pay $231,770 for defects in a home they built for Marsden. They argued that a work order to rectify the defects could have easily been made instead of damages, and that the Tribunal should not have considered any of their misconduct in previous building projects that were unconnected to this matter. KH also argued that under s48MA of the Home Building Act 1989 rectification of the defects by the responsible party is preferred.

Ultimately the Tribunal dismissed the appeal, stating that they were within their power to consider the previous misconduct of KH, as s79U(2)(g) Fair Trading Act 1987 states that the conduct of the parties to the claim in relation to similar transactions is to be taken into account when making orders. They also held that the preference for rectification in s48MA does not lead to an absolute right, and monetary orders can be made.

Interim Heritage Orders (IHOs) are a swift mechanism that can restrict or block development plans for a property. The recent case of Li v Willoughby City Council [2018] NSWLEC 1262 has highlighted just how easily a council can make such orders, if they consider the property may be of local heritage significance and is being or is likely to be harmed.

In this case, the council relied solely on a report prepared by the Council’s planning manager and a draft Inventory Sheet for the property in question prepared nine years earlier. The Inventory Sheet referred to studies and reports prepared by heritage consultants at the time it was created. The Court ultimately held that this document was enough to satisfy the IHO, despite the fact that nine years ago when the report was prepared the council had declined to make the same order. Therefore the heritage order was valid, and development on the property has halted.

The Federal Court has held that Meriton misled consumers on the popular travel website TripAdvisor by limiting the email addresses they supplied to the travel site for reviews or only supplying those of guests likely to give positive comments.

In Australian Competition and Consumer Commission v Meriton Property Services Pty Ltd (No. 2) [2018] FCA 1125, Meriton was found to have breached s34 of the Australian Consumer Law and was fined $3 million for their actions.

TripAdvisor requires their accommodation providers to supply the email addresses of guests that used the site to book their stay, and sends an email at the conclusion of the visit asking the guests to review the accommodation. However it was determined in court that Meriton’s standard operating procedure was to ask guests about their stay at check out, and if they responded negatively their email addresses would not be passed on to TripAdvisor. Meriton would also withhold all of the email addresses of guests whenever there was a service disruption at their property such as a broken lift or leak.

 

A recent decision in the Supreme Court has reinforced the principle that termination clauses will be interpreted in a sensible and businesslike manner. In DR Design (NSW) Pty Ltd v Grand City International Development [2017] NSWSC 1778, the court was asked to determine whether termination of an architectural services contract was valid, or in fact wrongful repudiation.

In the contract, both parties had an express right to terminate with 48 hours’ notice. GCI (the client) also had the additional obligation of paying DR the value of the work completed to date upon termination. When GCI purported to terminate the contract via a letter, DR claimed that their termination was not valid as they had not paid for the outstanding work yet. However, by applying the principle that termination clauses should be interpreted in a sensible, businesslike manner, the court decided that the payment obligation set out in the termination clause was a consequence of termination rather than as a condition precedent to the exercise of the right of termination.

The recent decision in Dennes v Port Macquarie-Hastings Council [2018] NSWLEC 95 has highlighted the importance of satisfying deferred commencement conditions before the specified period elapses, or else development consent may lapse. In this case, development consent for a flood-prone property in Beechwood was subject to a deferred commencement condition that required Mr Dennes to submit a Flood Emergency Response Plan (FERP) within 12 months. Mr Dennes submitted such a plan within that time frame, but it was rejected by the Council as it was ‘not capable of being supported in its current form.’ Mr Dennes then failed to take any action until four months after the time period of the deferred commencement condition had elapsed, at which time he appealed to the Land and Environment Court.

The court ultimately held that the presentation of the FERP to the Council was not enough to satisfy the deferred commencement condition, as it expressly required the council to find the FERP to be satisfactory. As this did not happened within the specified period, the court held that the development consent had elapsed with the deferred commencement condition. This decision is an important reminder that any appeals must be brought before the specified time period for the satisfaction of a condition elapses.

The NSW Civil and Administrative Tribunal has highlighted in a recent case that even where owners of a property have no direct contract with a subcontractor, they will have a right to certain statutory warranties.

In the recent decision of AJ Gouros Investments Pty Ltd trading as Adelaide Concrete Polishing & Grinding Pty Ltd v Pongraz [2018] NSWSCATAP 129 a flooring contractor was engaged by a builder to polish concrete floors, but failed to complete the work properly. The owners of the property attempted to begin proceedings, claiming that they were owed warranties under s18B of the Home Building Act 1989, but the flooring contractor claimed they were barred from doing so as his contract was with the builder, not the owners.

However s18D(1A) of the Home Building Act states that a person who is a non-contracting owner is entitled to the same statutory warranties as a party to the contract. Therefore the court ultimately decided that the owners in this case fit into the definition of a non-contracting owner, and were entitled to the statutory warranties. This is an important reminder that the Home Building Act will create obligations even where there is no contract, and so subcontractors seeking to avoid direct liability to owners may need to seek assurances from their head contractors.

A recent case in Germany has decided that Facebook accounts can be passed on in an estate, raising questions about social media platforms’ current policies surrounding user deaths. Currently, Facebook allows for an account to be terminated or turned into a memorial page after death, but the decision in Germany’s Federal Court of Justice has highlighted an issue with this policy when family members of the deceased request access to the accounts.

In this matter, the mother of a fifteen year old who was killed in a train accident wanted to access her daughter’s Facebook account to help her determine whether the death was a suicide, but due to Facebook’s current policy she was blocked from doing so. Facebook claimed this strict policy was to protect the privacy of the daughter’s contacts, but the mother argued that the social media accounts could be likened to private diaries that should be considered as part of her estate. The court agreed, holding that the daughter’s contract with Facebook was a part of her estate that legally passed to her mother upon her death.

While there is no current case law on this issue in Australia, this case highlights an increasingly important issue with estate planning and digital wealth, particularly for those with an online business or profitable social media accounts. Even wanting to pass on photos or videos stored on a digital device or cloud can be complex, and so it is recommended that a letter of wishes as to any accounts be included.

The NSW State Government has introduced changes to zoning regulations to keep up with demand for cafes in ‘hipster’, industrial neighbourhoods. In recent years, the retail landscape of Sydney has been changing, with consumers now wanting to be closer to producers and manufacturers making local goods. This has led to an interesting rise in demand for food and drink experiences in previously industrial areas such as Alexandria.

In response to this, the State government has introduced changes to the Standard Instrument (Local Environmental Plans) Order 2006 in order to allow land use that would have previously been prohibited in industrial zones. Now, the instrument has expanded the definition of ‘light industry’ to include artisan food and drink industries and garden centres.

There are key differences in the law between a licence and a lease, mainly revolving around exclusive possession of the premises. A lease endows this exclusive right on the tenant, where as a licence allows nonexclusive occupation.

In the case of Friendly Inn Holdings Pty Ltd v St George Bank [2012] NSWSC 127 the Supreme Court highlighted the circumstances in which a licence is appropriate. In this case, the plaintiff showed an interest in purchasing a hotel in Kangaroo Valley for $2.95 million. The defendants agreed to the sale and were under the impression it was to be settled imminently, and so allowed the plaintiff a licence to occupy the premises and start running the hotel. When it became clear the sale was not going to go through, the defendants cancelled the licence immediately and took possession of the hotel.

The plaintiff argued that he was in fact leasing the property as he was paying $12,000 in rent per month and was therefore entitled to reasonable notice of a termination. However, the court found that the agreement was in fact a short term licence that was conditional upon completing the contract for sale of the hotel. Licences are usually granted in cases like these where a more flexible arrangement is required, and therefore the notice given to the plaintiff was in fact reasonable.

In the recent case of Kids Club Rozelle Pty Ltd v European Hire Cars Pty Ltd [2018] NSWSC 1115 the Supreme Court had to determine the validity of a Deed of Surrender and Release where the tenant had made deceptive and misleading statements in the lead up to its creation. In this case, the parties entered into a lease with the intention of the tenant building a childcare centre on the land. When the funding for the childcare centre fell through, the tenant made false and misleading statements to the land owners, saying that they had impending offers to assign the lease, while in fact no such offers existed. The land owner’s did not want the lease to be assigned, and claimed that the misleading conduct induced them into entering the deed of surrender to terminate the lease early.

The court accepted that the conduct of the tenant in claiming there were offers to take an assignment of the lease was misleading and in breach of the Australian Consumer Law, but ultimately they found that it was not the only factor that induced the defendants to sign the deed of surrender. The court found that there were other factors in the defendant’s decision, as they believed the rent being paid was below market value, they didn’t want the lease to be assigned, and wanted to end their association with the plaintiff. Therefore while the conduct was misleading, the deed of surrender was still valid.