A recent case involving pre-sales statements about the availability of parking serves as a timely reminder to vendors and agents to take care when making pre-sales statements or representations. Here, partner Mark Lyons takes a look at the outcome of the case and also highlights that purchasers should ensure any representation made by or on behalf of the vendor is expressly set out in the contract if the purchaser intends to rely on it.
The case involved a residential property with a two-car garage plus a strip of land comprising one-third of the width of a common driveway providing access to the property and two other properties.
At the time of purchase, two signs on a wall abutting the property's strip stated 'Private parking space 24' (24 being the street number of the property). These signs did not appear to be new.
Online marketing materials advertised the property to include a 'Double garage plus private off-street and driveway parking'. A detailed site plan showed images of three cars parked end to end on the property's strip. Small print at the bottom of the plan disclaimed any responsibility for the accuracy of the plan. The printed brochure for the property stated there was 'plentiful parking' and included the same plan with the disclaimer.
The property was purchased for $9.4 million. The purchaser's husband, who had more than 15 years' experience in property development, conducted the negotiations and made the decision to proceed with the purchase. Shortly after settlement, an adjoining lot owner advised the purchaser that the whole driveway was a right of way and she was not entitled to park on the strip.
The purchaser commenced proceedings in the New South Wales Supreme Court against McGrath Sales Pty Ltd, the vendor's selling agent, for damages for misleading and deceptive conduct for the alleged pre-sale misrepresentations about the availability of parking at the property.
The Supreme Court concluded that whilst McGrath's misrepresentations constituted misleading and deceptive conduct that conduct had not caused the purchaser any loss. The court said the parking was not the main reason the purchaser bought the property, rather it was an emotional attachment.
The purchaser appealed to the Court of Appeal.
The Court of Appeal dismissed the appeal for several reasons.
Purchasers, vendors and agents should take note of this important reminder about reliance on pre-sales statements in property transactions. Our lawyers can help you understand the consequences and answer your queries.