Deming No 456 Pty Ltd v Brisbane Unit Development Corporation Pty Ltd

However, as has been seen, on 23 June 1982 the lot entitlement and aggregate lot entitlement proved to be not the same as the proposed lot entitlement and proposed aggregate lot entitlement set out in the contract: the first appellant's entitlement became 1/37 instead of 1/41 of the aggregate. The respondent was therefore required by s. 49(4)(c) to give forthwith to the purchaser notice in writing disclosing full particulars of the change. It failed to give any notice. In those circumstances the first appellant was entitled to avoid the contract by giving notice under s. 49(5), provided that it could prove that its rights had been materially affected by the change. In this regard there is at least a triable issue as to whether the first appellant gave the notice within thirty days after it first became aware that the actual entitlements were different from the proposed entitlements. However, it was held in the Supreme Court that the first appellant had failed to prove that its rights had been materially affected. In my opinion the difference (an increase of 10.81 per cent) between the proportional entitlement of the first appellant under the plan and the proposed proportional entitlement as stated in the contract could well prove to be material. Under s. 32 of the Act, the contributions levied by a body corporate are payable by the proprietors in shares proportional to their lot entitlements. The liability of the first appellant to pay contributions would therefore be increased by 10.81 per cent. It is true that there is no evidence as to what the amount of the contributions was likely to be, but the contribution payable by the owner of a unit in a suburban residential building is likely to be not inconsiderable in any event, and the extent of the liability must always be attended by some uncertainty: see s. 38(1)(q). The mere fact that the first appellant's contributions would be increased by over 10 per cent was enough to raise a triable issue of the question whether the first appellant's rights were materially affected. In the circumstances the first appellant had shown matters which raised a triable issue as to whether the contract had been avoided by the notice given in October 1982, and should have been given leave to defend for the purpose of litigating this question.

It will have been apparent from the nature of this discussion of the questions involved that s. 49 creates considerable difficulties of construction and is likely to lead in some cases to inconvenience or injustice. The remedy however lies in the hands of the legislature.

I would allow the appeal, set aside the order for summary judgment and give the first appellant (the defendant in the action) leave to defend.

Brisbane Unit Development Corporation Pty. Ltd. ("the vendor") brought proceedings in the Supreme Court of Queensland seeking an order for specific performance of a contract for the sale by it of a home unit lot with associated interest in common property under a strata title plan which was to be registered under the Building Units and Group Titles Act 1980 Q. ("the Act"). The defendants in the action were Deming No. 456 Pty. Ltd. which was the purchaser under the contract ("the purchaser") and Vincent Gregory Thackeray and Jennifer Thackeray who were directors of the purchaser and guarantors of its performance of the contract. The contract was dated 25 August 1981. The home unit was to be on the eighth floor of a building to be known as "North Shore" in the Brisbane suburb of St. Lucia. The erection of that building was apparently completed around July 1982.

On 29 September 1982, the vendor applied, on summons, for an order for summary judgment under O. 18a, r. 1 of the Rules of the Supreme Court. The application was heard by McPherson J. who found that the vendor was entitled to summary judgment against the purchaser and the guarantors and ordered that judgment be entered accordingly [4] . The purchaser and the guarantors appealed from that judgment to the Full Court of the Supreme Court. The Full Court (Douglas, Sheahan and Connolly JJ.) varied the judgment appealed from by ordering that it be limited to a judgment against the purchaser and ordered that the action as against the guarantors be stood over to be brought on should the purchaser fail to comply with the order for specific performance of the contract. Otherwise, the Full Court dismissed the appeal [5] . The present appeal is brought by the purchaser and the guarantors against the orders of the Full Court.

The only grounds which the purchaser and guarantors now propound as constituting an answer to the vendor's action for specific performance are based on the provisions of s. 49 of the Act. To the extent that the provisions of that section are of direct relevance to the present case, they provide:

(1) An original proprietor shall give to the purchaser of a lot or of a proposed lot a statement in writing in compliance in every respect with the requirements of this section.

(2) A statement in writing under this section shall -

(b) state the names and addresses respectively of the original proprietor and the purchaser;

(i) the lot entitlement of every lot and the aggregate lot entitlement; or

(ii) the proposed lot entitlement of every proposed lot and the proposed aggregate lot entitlement;

(e) set out or be accompanied by the by-laws in force in respect of the plan or the proposed by-laws in respect of the proposed plan;

(f) state the date on which the statement is given; and

(g) be signed by the original proprietor or on his behalf by a person authorized in writing by the original proprietor in that regard.

(3) A statement in writing under this section shall -

(a) be given by the original proprietor to the purchaser before the purchaser signs any contract, agreement or document whatsoever legally binding or intended to bind the purchaser legally in respect of the sale; or

(b) form part of a contract, agreement or document referred to in paragraph (a).

(4) If, at any time after the original proprietor gives a statement in writing pursuant to subsection (1) to a person who enters into a contract as purchaser in respect of the sale of a lot or of a proposed lot and before the registration of that person as the proprietor of the lot

(c) the lot entitlement of any lot or the aggregate lot entitlement is not the same as the lot entitlement or proposed lot entitlement or the aggregate lot entitlement or proposed aggregate lot entitlement, as the case may be, that was set out in or accompanied the statement given to the purchaser pursuant to subsection (1)

the original proprietor shall forthwith give to the purchaser notice in writing disclosing full particulars thereof

(5) If the original proprietor fails to give to a purchaser -

(a) a statement in compliance in every respect with subsections (1), (2) and (3); or

the purchaser may void the contract, agreement or other document signed by him in relation to the original proprietor by notice in writing given to the original proprietor within 30 days after he first becomes aware of the failure:

Provided always that a purchaser may not void a contract, agreement or other document pursuant to paragraph (b) unless he proves that his rights have been materially affected by a matter referred to in that paragraph.

(6) Upon the voidance of a contract referred to in this section the original proprietor shall be liable at law for the repayment to the purchaser of all moneys paid by him under the contract and such moneys shall be recoverable, by action as for a debt, by the purchaser accordingly.

It is common ground between the parties that the contract in the present case was, for the purposes of s. 49, a contract for the sale of a proposed lot by the vendor as an original proprietor. That being so, the vendor was obliged to give to the purchaser the "statement in writing" required by sub-ss. (1), (2) and (3) of the section and, in the event of a variation in the "lot entitlement" of the lot or of the "aggregate lot entitlement" as mentioned in par. (c) of sub-s. (4), to give to the purchaser a notice required by that sub-section. It is submitted on behalf of the purchaser that McPherson J. was in error in ordering the entry of summary judgment in that the evidence before him indicated that the purchaser had duly avoided the contract pursuant to each of pars. (a) and (b) of sub-s. (5) of s. 49 on the respective grounds that the vendor had failed to give a statement in writing in compliance with sub-ss. (1), (2) and (3) and that, there having been a variation in lot entitlement, the vendor had failed to give the notice of variation prescribed by sub-s. (4). Alternatively, it is submitted that the evidence before McPherson J. at the least disclosed that the purchaser had a case against specific performance which should have been allowed to go to trial. To understand those submissions, it is necessary to refer in greater detail to the evidence before the learned primary judge.

The form of contract (in triplicate) was forwarded to the purchaser for execution by it under cover of a letter dated 13 August 1981. The Ninth Schedule to the form of contract was expressed to set out a "STATEMENT BY ORIGINAL PROPRIETOR PURSUANT TO SECTION 49 OF THE BUILDING UNITS AND GROUP TITLES ACT 1980 ". The forms of contract were, after execution by the purchaser and the guarantors, returned to the vendor. The contract was then executed by the vendor and an executed copy was sent to the purchaser under cover of a letter of 28 August 1981.

There was provision at the foot of the statement contained in the Ninth Schedule for a signature for and on behalf of the original proprietor by a director duly authorized for that purpose. In the form of contract forwarded to the purchaser for execution, the signature of a Mr. Bradford appeared in this space. Presumably at the time when the contract was executed by the vendor, a Mr. Ferro, who was a director of the vendor, added his signature to the statement alongside that of Mr. Bradford. The Ninth Schedule was on the last page of the contract and, in the contract as executed by the parties, was followed, after a gap, by the execution clauses. It is not disputed by the purchaser that the contract, as finally executed, was executed by the vendor itself as distinct from being executed by an agent acting for it as principal. It is now common ground that, apart from the effect of the provisions of s. 49 of the Act, the contract was binding in accordance with its terms.

The evidence indicates that, at some stage between August 1981 and 7 June 1982, the purchaser lost enthusiasm for the agreement which it had made. On 7 June, Mr. Thackeray telephoned the purchaser's solicitors. He spoke to an articled clerk from whom he requested advice "as to whether or not there was a defect in the contract". The clerk examined the contract and advised Mr. Thackeray that a perusal of the statement in the Ninth Schedule indicated that the vendor had not complied with s. 49 of the Act in that it had failed to set out its address. On or about 17 June 1982, the purchaser's solicitors gave notice to the vendor that the purchaser elected "pursuant to the aforesaid Section 49" of the Act "to void" the contract. The notice demanded repayment of the deposit which the purchaser had paid on the ground that the deposit was "repayable in accordance with the provisions of Section 49 Subsection (6), the aforesaid [vendor] being in breach of its obligations pursuant to the provisions of Section 49". A copy of the notice was forwarded to the vendor's solicitors under cover of a letter which repeated the assertion that the vendor had failed to comply with the requirements of s. 49 of the Act and stated that the amount paid by way of "purported deposit" was $18,200. Neither the notice nor the letter to the vendor's solicitors gave particulars of the alleged failure. The evidence indicates that the only suggested failure which had been identified by the purchaser at that time was the absence of the vendor's address in the statement constituting the Ninth Schedule of the contract but there was no communication from the purchaser to the vendor which could be interpreted as restricting or tying the notice of avoidance to that particular failure. By the time the summons for summary judgment came on for hearing before McPherson J., a number of other alleged deficiencies in that statement had been identified. The purchaser is, in these circumstances, entitled to rely on all of such alleged deficiencies to support its general contention that the vendor had failed to comply with the requirements of s. 49 in that it had failed to give it a statement in writing which complied "in every respect" with the requirements of the section. In that regard, there is nothing in s. 49 which requires a purchaser to state in a notice of avoidance under s. 49(5) all of the grounds upon which it is said that the vendor has failed to comply in every respect with sub-ss. (1), (2) and (3). It is unnecessary to consider whether, in a case where a purported avoidance of a contract is specifically based upon and tied to an identified alleged failure which has, in fact, not occurred, a purchaser can subsequently seek to sustain the avoidance by reliance upon some other failure to which no reference has been made: cf. Clegmere Pty. Ltd. v. Samspring Pty. Ltd. [6] and Shepherd v. Felt and Textiles of Australia Ltd. [7] .

1. [1983] 2 Qd R. 399. 2. (1931) 45 C.L.R. 359, at pp. 370-371, 373, 377-378.

In the courts below, there was some discussion of the question whether the forwarding to the purchaser for execution of the form of contract incorporating the statement signed by Mr. Bradford itself constituted a giving, under s. 49(3)(a), of a statement in writing to the purchaser. In our view it did not. Sub-section (3) of s. 49 identifies two alternative means by which the obligation imposed by sub-s. (1) to "give" the statement in writing to the purchaser can be satisfied. The first is by giving it to the purchaser before the purchaser signs the contract. The second is by incorporating the statement in writing as part of the contract. The forwarding of a contract, for execution and return, incorporating the required statement is an unmistakable intimation of an intention that the statement is to be given in the manner provided for in sub-s. (3)(b). Moreover, the requirement to "give" a statement in writing which has been signed by or on behalf of the original proprietor involves delivery of such a statement on the basis that it may be retained by the purchaser. That requirement is not satisfied by the mere delivery of a document for execution and return: cf. J. & S. Holdings Pty. Ltd. v. N.R.M.A. Insurance Ltd. [8] . It follows that the question whether the vendor complied with its obligations under s. 49(1), (2) and (3) of the Act falls to be determined by reference to whether the statement incorporated as part of the contract satisfied the requirements of the section.

1. (1982) 61 F.L.R. 108, at pp. 115-116; 41 A.L.R. 539, at p. 545.

The starting point for consideration of the question whether a statement in writing satisfies the requirements of s. 49 in a case where some statement was incorporated in the contract in purported compliance with the requirements of the section must be the identification of the relevant statement in writing. In some cases, that might be a difficult task. It presents a little difficulty here. The Ninth Schedule expressly identifies the statement which it contains as the "STATEMENT BY ORIGINAL PROPRIETOR PURSUANT TO SECTION 49" of the Act. Condition 16(c) of the contract expressly provides that the statement to the purchaser by the original proprietor in accordance with s. 49 of the Act "is set out in the Ninth Schedule to this agreement". In those circumstances, the purported statement is plainly identified as that "set out" in the Ninth Schedule. Subject to possible incorporation of other material by reference, by annexation, by contemporaneous delivery or by reason of surrounding circumstances, the statement which must, in the present case, satisfy the requirements of s. 49 is that contained in the Ninth Schedule of the contract: cf. Edgware Trust Ltd. v. Lawrence [9] .

1. [1961] 1 W.L.R. 1354, at pp. 1358-1359; [1961] 3 All E.R. 141, at p. 144.

The purchaser advances a number of distinct grounds of attack on the sufficiency of the statement in the Ninth Schedule. Each involves a question of the construction or the correct application of the provisions of s. 49. Those provisions are penal in character in that a failure to comply with their requirements is, under s. 133 of the Act, an offence punishable by a penalty not exceeding $500. That being so, the prima facie construction of those parts of the section which impose obligations is that any real ambiguity persisting after the application of the ordinary rules of construction is to be resolved in favour of the most lenient construction: see Beckwith v. The Queen [10] . It is submitted on behalf of the purchaser that another relevant principle of construction in the present case is that any ambiguity in the obligations imposed by the section is to be resolved in favour of the construction which will most effectively meet the evil which the legislation is designed to remedy. A major problem with that submission is the difficulty in discerning any intelligible and coherent underlying purpose in legislation which provides, as does s. 49, that a vendor of a home unit who is an original proprietor must include in a statement in writing to be given to a purchaser a variety of information, ranging from the significant such as lot entitlement and applicable by-laws to information which would ordinarily only be obtainable from the purchaser himself such as the purchaser's own address, in a context where a failure to include any of that information, however innocent and harmless, will result in an offence under the Act and will constitute a ground for avoiding what may well be a completely fair contract. Although the provisions of the section were intended to afford meaningful protection to a purchaser in a case where the requirements which the section imposes are not satisfied, the difficulty of identifying the mischief aimed at in the selection of the requirements of a notice in writing under sub-s. (1) makes it inappropriate to approach the construction of those requirements otherwise than on the basis that, if there be ambiguity, the most lenient construction is to be preferred.

We turn to consider the grounds upon which the purchaser attacks the sufficiency of the statement in the Ninth Schedule to the contract. In the event that the evidence, in its present state, indicates that there was a failure to comply with the requirements of s. 49(1), (2) and (3), it will be necessary to examine the effect of the provisions of s. 49(5) and to consider whether the evidence indicates that there is a reasonably arguable question whether the contract had been effectively avoided which should have been allowed to go to trial. Finally, it will be necessary to consider whether there is a real and open question whether the purchaser effectively avoided the contract by reason of a failure by the vendor to comply with the requirements of s. 49(4).

Section 49(2)(b) requires that the statement in writing "state" the name and address of the original proprietor. As the statement which constitutes the Ninth Schedule of the contract neither states nor refers to the address of the vendor, it fails, if viewed on its own, to satisfy that requirement.

It is submitted on behalf of the vendor that the requirement that the vendor's address be stated in the s. 49 statement was satisfied by the setting out of that address in the body of the contract of which the Ninth Schedule formed part. In our view, that submission cannot be accepted. The requirement of s. 49(2)(b) is that a s. 49 statement itself state the address of the original proprietor. It is, no doubt, possible that a s. 49 statement might be contained in a number of related documents or incorporate, by reference, documents attached to it: cf. Reading Trust Ltd. v. Spero [11] . In the present case, however, as has been seen, the express provisions of cl. 16(c) and the heading in the Ninth Schedule make clear that the statement in the Ninth Schedule is the statement under s. 49(1). That statement cannot properly be read as incorporating in itself the whole of the contract of which it forms but a part. It did not state the address of the vendor nor incorporate, by reference or otherwise, any document or other material stating that address. The failure in that regard to comply with the requirements of s. 49(2)(b) could not have been capable, in the circumstances, of causing any detriment to the purchaser. Unintentional and harmless though it may have been however, the failure to state the vendor's address in the statement had the consequence that the statement did not satisfy the requirements of s. 49. It "is no answer to say" that the purchaser "knew exactly" what the relevant information was: cf. per Morton L.J. in Kent Trust Ltd. v. Cohen [12] .

1. [1930] 1 K.B. 492, at pp. 505, 507-508. 2. [1946] K.B. 584, at p. 590.

Section 49(2)(e) requires that the statement in writing "set out or be accompanied by the by-laws in force in respect of the plan or the proposed by-laws in respect of the proposed plan". The statement in the Ninth Schedule did not set out the proposed by-laws. It contained a statement that the by-laws were in accordance with the Third Schedule to the contract subject only to the provisions of condition 8(h). Condition 8(h) of the contract provided that the purchaser agreed that, on registration of the building units plan, the vendor as sole proprietor "may amend the By-laws of the Body Corporate in accordance with the amendments set out in the Third Schedule" subject to a proviso that the vendor "shall make no such further amendment as shall materially prejudice the interests of the Purchaser". The Third Schedule of the contract contained a list of proposed alterations "to the third Schedule By-laws as set out in the Act". The result was that the proposed by-laws in respect of the proposed plan were those set out in the Third Schedule to the Act subject to the proposed amendments set out in the Third Schedule to the contract and such further amendments as the vendor might make pursuant to condition 8(h) of the contract. The statement under s. 49(1) neither set out nor was accompanied by a copy of the by-laws set out in the Third Schedule to the Act.

It is submitted on behalf of the vendor that, since the by-laws set out in the Third Schedule to the Act would prima facie apply in respect of the proposed plan by virtue of the provisions of s. 30 of the Act, they constituted part of the law of Queensland and therefore did not require to be set out in or accompany the statement pursuant to s. 49(1). We are unable to accept that submission. Section 49(2)(e) expressly requires that the by-laws be set out in or accompany the statement in writing. The contract of which the statement in writing formed part expressly recognized that the primary by-laws in respect of the proposed plan would be those which were set out in the Third Schedule to the Act and which neither "accompanied" nor were "set out" in the statement in writing. Again, it is not suggested that the failure of the statement in writing or any accompanying document to set out those proposed by-laws caused any detriment to the purchaser. That failure was, however, sufficient to prevent the statement from complying "in every respect" with the requirements of s. 49.

Section 49(2)(f) provides that a statement in writing under the section shall "state the date on which the statement is given". The statement in the Ninth Schedule was dated 13 August 1981. It contained no statement of the date on which it was "given".

As has been said, s. 49(3) provides two alternative means of satisfying the requirement of s. 49(1) that an original proprietor give, to the purchaser of a lot, a statement in writing in compliance with the section. The first of those alternatives involves the actual giving of the statement to the purchaser. The second is that the statement in writing forms part of the relevant contract, agreement or document. When the requirement to give a statement to the purchaser is satisfied by the statement forming part of the relevant contract, agreement or document, it may never be "given" to the purchaser in the ordinary meaning of that word. Indeed, if the form of contract incorporating the required statement was, in an exceptional case, prepared by the purchaser, s. 49(1) could be satisfied without any document containing the statement ever having passed from the original proprietor to the purchaser.

The requirement that a statement under s. 49 state the date on which it is "given" is inappropriate to the case where the statement constitutes part of the relevant contract, agreement or document. In such a case, the statement will speak as of the date of the contract, agreement or document. The provisions of s. 49(2)(f) should be construed as being inapplicable to such a case. It follows that it was unnecessary that the statement in the Ninth Schedule set out a date on which it was said to have been "given". In so far as other subsections of s. 49 operate by reference to the date on which the statement under s. 49(1) was "given", they should be construed, in a case such as the present, as referring to the date upon which the contract, agreement or document of which the statement forms part became effective or operative.

Section 49(2)(g) requires that the statement under the section "be signed by the original proprietor or on his behalf by a person authorized in writing by the original proprietor in that regard". It is arguable that this requirement is also inappropriate where the requirements of the section are satisfied not by the actual giving of the statement to the purchaser but by the statement being incorporated as part of the relevant contract, agreement or document. Be that as it may however, we are of the view that any requirement that the statement under s. 49 be signed is satisfied in a case such as the present where the contract, agreement or document is signed by the original proprietor and the original proprietor's signature is referable to all the contents of the contract, agreement or document including the incorporated statement.

The Purported Avoidance of the Contract Under s. 49(5)(a).

Section 49(5)(a) provides that, if the original proprietor fails to give to a purchaser a statement in compliance in every respect with sub-ss. (1), (2) and (3), the purchaser may avoid the contract, agreement or document by notice in writing given to the original proprietor within thirty days after he first becomes aware of the failure. It has been seen that the statement under s. 49 incorporated in the contract did not comply in every respect with sub-s. (2) of s. 49 in that it failed to state the address of the original proprietor and it failed to set out or be accompanied by the proposed by-laws in respect of the proposed plan. The question arises whether, on the evidentiary material in its present state, there is a case which should be allowed to go to trial that the notice of avoidance was given within thirty days of the purchaser becoming aware of "the failure".

The evidence on behalf of the purchaser can be briefly summarized. The form of contract, containing the s. 49 statement, was received by Mr. Thackeray, on behalf of the purchaser, on or shortly after 13 August 1981. According to Mr. Thackeray, he noticed that the purchaser was wrongly described in the contract. He went through the contract and changed the name of the purchaser wherever it appeared from Deming No. 256 Pty. Ltd. to Deming No. 456 Pty. Ltd. and initialled in the margin the changes that he had made. One of those changes was in the actual body of the s. 49 statement. Mr. and Mrs. Thackeray both executed the contract as directors of the purchaser. They also executed a guarantee contained in the Fourth Schedule to the contract. Mr. Thackeray's affidavit states that, at the time he signed the contract, he neither realized what the statement under s. 49 was nor realized that such a statement was required to be given. According to him, he paid no regard to the statement other than as necessary to change the name of the purchaser and initial the changes. He swore that, apart from what has been said above, he "did not read the contract other than to ascertain the correct name of the purchaser and also details as to deposit price and payment of purchase money". He did, however, take a photocopy of the form of contract. His evidence is silent as to if and when he subsequently examined the contents of that photocopy or the executed contract which was returned to him. Mr. Thackeray explained the circumstances of the giving of the notice to avoid the contract as being that, on 7 June 1982, he was informed by a purchaser of another unit in the "North Shore" building that "the original proprietor had failed to comply with Section 49" of the Act, that he had then rung the purchaser's solicitors and been informed that, in the opinion of the articled clerk to whom he spoke, that section of the Act had indeed not been complied with. In the absence of any evidence as to when either the photocopy or the executed contract was first thoroughly examined on behalf of the purchaser, we would not be prepared to find that the purchaser had shown that it had an arguable case that it was not fully aware of the contents of the contract, including the statement in the Ninth Schedule, in or shortly after August 1981. On the other hand, the material presently in evidence indicates that it was not until June 1982 that the purchaser became conscious of the fact that a legal consequence of the contents and form of the statement in the Ninth Schedule was that it did not comply in all respects with the requirements of s. 49. In these circumstances, the answer to the question whether the notice given was given within the time allowed by s. 49(5) depends upon when it can be said, within the meaning of that sub-section, that a purchaser "becomes aware" of a "failure" by an original proprietor to give a statement in compliance in every respect with sub-ss. (1), (2) and (3) of s. 49.

In one sense, a person can be said to become aware that a statement containing the material prescribed by s. 49 has not been given even though he is unaware that s. 49 imposed upon the vendor any obligation at all to give such a statement. Knowledge that a thing has not been done at all necessarily amounts to knowledge that it has not been done in any of the ways in which it might have been done. But it does not amount to knowledge that the non-performance has the quality or character of a failure to comply with particular statutory provisions unless and until knowledge is acquired of those statutory provisions or of their relevant effect or of a conclusion that there has been a failure to comply with their terms. Thus, a person would not ordinarily be said to become aware of a "failure" to give a statement in compliance with s. 49 until he becomes aware both of the obligation to give such a statement and of the fact it has not been given. Similarly, a person who knew that a statement which he had received did not state the address of the vendor or set out the proposed by-laws which would apply to the "lot" which he was purchasing would be "aware" that the statement which he had been given did not contain that information but he would not ordinarily be said to be "aware" of a "failure" by the statement to comply "in every respect with sub-sections (1), (2) and (3)" of s. 49 unless he had some information as to the requirements of those sub-sections or as to whether the statement which he had been given satisfied them.

The consequences of this interpretation are drastic: a purchaser who is not given a statement under s. 49 containing the material particulars may avoid the contract even after its completion (s. 49(6)) so long as he does so within thirty days of becoming aware of the statutory provisions or of their relevant effect, namely, that they imposed an obligation on the vendor in a respect or respects in which the statement is deficient. Drastic though they be however, those consequences do not justify the adoption of an interpretation more favourable to the vendor unless the statutory language lends itself to such an interpretation. And the language of sub-s. (5) is not susceptible of such an interpretation unless one can impute to a purchaser knowledge of the requirements of s. 49. We would be inventing a new doctrine of constructive notice if we were to hold that a purchaser is "aware" of a failure to comply with particular statutory provisions when he knows the facts, even though he is ignorant of those provisions and of the obligations which they impose. Indeed, the very words "becomes aware" strongly indicate that the statute is looking to the purchaser's actual knowledge of the failure which, by description, is a failure to comply with the statutory provisions. We conclude that the words "becomes aware of the failure" in s. 49(5) involve not only knowledge that a statement containing the specified material has not been given but an awareness that the fact that such a statement was not given constitutes a "failure" to do something which the Act says should be done.

On the present state of the evidence, the purchaser first became aware of a suggested "failure" to comply with the obligation imposed by s. 49(1), (2) and (3) on 7 June 1982. The notice in intended pursuance of s. 49(5) was given on or about 17 June 1982. In these circumstances, the question whether the notice of avoidance was given within thirty days of the purchaser first becoming aware of the vendors' failure to give a statement in accordance with s. 49 should have been allowed to go to trial.

Section 49(4) and the Purported Avoidance of the Contract Under s. 49(5)(b).

The material before the court indicates that the purchaser, through its solicitor, became aware on or about 8 October 1982 that both the lot entitlement of the lot the subject of the contract and the aggregate lot entitlement disclosed in the building units plan as registered differed from what was stated in the contract. On that day, the solicitors for the purchaser gave notice by telex purporting to avoid the contract on the ground that the vendor had failed to give notice of the particulars of the variation as required by s. 49(4)(c).

The lot entitlement of the subject lot appeared from the Second Schedule to the contract as two units in an aggregate entitlement of eighty-two. Under the plan as registered, the lot entitlement was one in an aggregate entitlement of thirty-seven. One effect of the variation was that the purchaser's liability to contribute in respect of management and maintenance costs would be increased by more than 10 per cent. Against this, the purchaser would have a correspondingly increased benefit in terms of proportionate voting rights and proportionate share of the common property.

It is common ground between the parties that, upon the variation in aggregate lot entitlement, the vendor was required forthwith to give notice in writing "disclosing full particulars thereof" pursuant to sub-s. (4) and that no such notice was in fact given. On the evidence as it presently stands and on the construction which we would give to the words "first becomes aware of the failure" in s. 49(5) (see above), it follows that the purchaser has shown that it has an arguable case which should be permitted to go to trial on the question whether it gave notice within the time allowed by that sub-section.

The question then arises whether the purchaser has shown that it has a case that should be allowed to go to trial on the question whether its "rights have been materially affected" by the variation within the meaning of those words as they appear in the proviso to sub-s. (5). The onus of proving that its rights have been materially affected rests upon the purchaser. In the view we take and in the absence of any contrary evidence on behalf of the vendor however, the fact that the contributions which the purchaser will be required to pay in respect of the unit have been increased by more than 10 per cent as a result of the variation, suffices in itself, to require the conclusion that there is a question as to material affectation which should have been allowed to go to trial.

The appeal should be allowed. The order of the Full Court of the Supreme Court of Queensland should be set aside and in lieu thereof it should be ordered that the orders for summary judgment be set aside and the defendants be given unconditional leave to defend the action. The costs of the summons for summary judgment should be reserved to be dealt with on the trial of the action. The vendor should be ordered to pay the costs of the purchaser and of the guarantors both in this Court and in the Full Court of the Supreme Court.

It is apparent from their technical nature and operation that the provisions of s. 49 of the Act are capable of being abused in much the same way as the provisions of former money-lending legislation were capable of being transformed from a safeguard for disadvantaged borrowers into an instrument of injustice in the hands of the unprincipled. Plainly, there is a need for legislative action either to modify the requirements of s. 49 of the Act or to empower the courts to grant relief, in an appropriate case, against the consequences of an innocent failure to comply with them.

This is an appeal from a unanimous decision of the Supreme Court of Queensland dismissing an appeal from an order for summary judgment in an action instituted by the respondent for specific performance of a contract for the sale of a lot and an undivided share in common property in a building registered under the Building Units and Group Titles Act 1980 Q. ("the Act"). Under the contract the first appellant, Deming No. 456 Pty. Ltd. ("Deming"), is the purchaser and the respondent is the vendor. The appellants claim that the order for summary judgment in the action ought not to have been made for all or any of the following reasons: (a) the purchaser having purported, pursuant to s. 49(5)(a) of the Act, to avoid the contract by reason of the non-compliance with s. 49(1) by the vendor, being the original proprietor referred to therein, the latter failed to discharge the onus placed upon it by s. 49(10) of providing that it had duly given to the purchaser a statement in writing in compliance with the requirements of the section; (b) the vendor was in breach of s. 49(4) in that it had failed to notify the purchaser of a change in its lot entitlement, a change which materially affected the purchaser and in consequence of which the purchaser had duly exercised the right to avoid the contract conferred upon it by s. 49(5)(b); (c) alternatively, the appellants had raised issues of fact in respect of these matters and they should have been given leave to defend: Rules of the Supreme Court, O. 18a, r. 3.

Notwithstanding its comparatively brief life, s. 49 has been the subject of extraordinary litigious activity. Designed to protect purchasers in the halcyon days of the home unit boom in the late seventies, its seemingly stringent technical requirements have been seen as providing a ray of hope to despairing purchasers in a time of economic recession. Unfortunately, its terms are not altogether clear and have allowed room for the intensive disputation that has occurred. The material provisions of the section are as follows:

(1) An original proprietor shall give to the purchaser of a lot or of a proposed lot a statement in writing in compliance in every respect with the requirements of this section.

(2) A statement in writing under this section shall -

(a) clearly identify the lot or proposed lot to which the statement relates;

(b) state the names and addresses respectively of the original proprietor and the purchaser;

(i) the lot entitlement of every lot and the aggregate lot entitlement; or

(ii) the proposed lot entitlement of every proposed lot and the proposed aggregate lot entitlement;

(i) any management agreement that the original proprietor has entered into in respect of the plan or proposed plan; and

(ii) any existing agreement for service or maintenance of the common property or any part thereof,

including the terms and conditions of that agreement and the estimated costs thereof to the proprietor of each lot;

(e) set out or be accompanied by the by-laws in force in respect of the plan or the proposed by-laws in respect of the proposed plan;

(f) state the date on which the statement is given; and

(g) be signed by the original proprietor or on his behalf by a person authorized in writing by the original proprietor in that regard.

(3) A statement in writing under this section shall -

(a) be given by the original proprietor to the purchaser before the purchaser signs any contract, agreement or document whatsoever legally binding or intended to bind the purchaser legally in respect of the sale; or

(b) form part of a contract, agreement or document referred to in paragraph (a).

(4) If, at any time after the original proprietor gives a statement in writing pursuant to subsection (1) to a person who enters into a contract, agreement or document whatsoever legally binding or intended to bind that person as purchaser in respect of the sale of a lot or of a proposed lot and before the registration of that person as the proprietor of the lot (or earlier rescission of the contract, agreement or document) -

(a) the original proprietor in his own right or exercising power as the body corporate enters into a management agreement or agreement for service or maintenance of the common property or any part thereof or varies any existing agreement whereby the rights of the purchaser are likely to be affected;

(b) the original proprietor makes a by-law other than a by-law which is the same as a proposed by-law that was set out in or accompanied the statement given to the purchaser pursuant to subsection (1) or amends, adds to or repeals any by-law;

(c) the lot entitlement of any lot or the aggregate lot entitlement is not the same as the lot entitlement or proposed lot entitlement or the aggregate lot entitlement or proposed aggregate lot entitlement, as the case may be, that was set out in or accompanied the statement given to the purchaser pursuant to subsection (1); or

(d) there is any change in the proposed lot entitlement or the proposed aggregate lot entitlement that was set out in or accompanied the statement given to the purchaser to subsection (1),

the original proprietor shall forthwith give to the purchaser notice in writing disclosing full particulars thereof and if the rights of the purchaser have been materially affected (proof of which shall lie on him) by any matter referred to in the notice and he has not agreed to be bound by that matter, he may void the contract, agreement or other document by notice in writing given to the original proprietor within 30 days of the date of receipt by him of the notice given by the original proprietor.

(5) If the original proprietor fails to give to a purchaser -

(a) a statement in compliance in every respect with subsections (1), (2) and (3); or

the purchaser may void the contract, agreement or other document signed by him in relation to the original proprietor by notice in writing given to the original proprietor within 30 days after he first becomes aware of the failure: Provided always that a purchaser may not void a contract, agreement or other document pursuant to paragraph (b) unless he proves that his rights have been materially affected by a matter referred to in that paragraph.

(6) Upon the voidance of a contract referred to in this section the original proprietor shall be liable at law for the repayment to the purchaser of all moneys paid by him under the contract and such moneys shall be recoverable, by action as for a debt, by the purchaser accordingly.

(7) Save as prescribed by subsections (4) and (5) this section applies so as not to render illegal or void any contract or to empower any party to void the contract.

(8) Where pursuant to this section a purchaser voids a contract entered into by him for the purchase of a lot or a proposed lot to which this section applies after the lot purchased by him has been registered in his name, then that purchaser, subject to the tender to him of repayment in full as prescribed by subsection (6), shall execute such instruments as, being necessary to register that title in the name of the original proprietor and deliver up to the original proprietor or his nominee, are presented to him for execution by or on behalf of the original proprietor and deliver up to the original proprietor or his nominee any relevant certificate of title in his possession or under his control, but the purchaser shall not be liable for any costs or expenses in respect thereof.

(9) Any covenant, agreement or condition expressed or implied in any contract, agreement or document whatsoever legally binding, or intended legally to bind, the purchaser in respect of the sale to that purchaser of any lot or any proposed lot to which this section applies, or in a separate document, whereby it is agreed between the original proprietor and the purchaser that this section or any provision hereof shall not apply in respect of that sale, or shall so apply subject to exceptions, limitations or restrictions, or otherwise affecting or prejudicing the rights and remedies had by the purchaser under this section or any provision hereof, shall be absolutely void and of no legal effect whatsoever.

(10) In any civil proceedings arising out of or connected with a contract, agreement or document to which this section relates the onus of proving that the statement referred to in subsection (2) was duly given shall lie upon the party so alleging.

It will be observed that sub-s. (3) provides for alternative procedures to be followed. Either the statement shall be given before the contract is concluded, or it shall form part of the contract. It is, no doubt, physically possible to follow both procedures, but in that event I think the convenient operation of s. 49(4) requires that the later statement must necessarily displace the former. There cannot be two effective statements in being at the same time. I am tempted to think that the draftsman may have intended to link pars. (a) and (b) of s. 49(3) with the conjunctive "and" rather than with the disjunctive "or". This would have resulted in greater harmony within the section. However, the literal meaning does not lead to absurdity and I can therefore find no justification for so reading the section. It is common ground in the present case that the latter procedure was followed. Clause 16(c) of the contract refers to the statement, says it is given by the original proprietor in pursuance of its obligation in accordance with s. 49(1) and s. 49(3) of the Act, and states that it is set out in the Ninth Schedule to the contract. That schedule reads as follows:

Statement by original proprietor pursuant to section 49 of the Building Units and Group Titles Act 1980.

Identification of Unit: Unit 14 on 3rd floor as identified in sketch plan in subject agreement (where building units plan has been registered, Lot______in Registered Building Units Plan No.______).

Original Proprietor: Brisbane Unit Development Corporation Pty. Ltd.

Purchaser: Name: Deming No. 456 Pty. Ltd. Address: 10th Floor, C.G.A. House, 379 Queen Street, Brisbane.

Lot Entitlement and Total Unit Entitlement: In accordance with the Second Schedule to the subject agreement.

By-laws: In accordance with the Third Schedule to the subject agreement subject only to the provisions of condition 8(h) of the subject agreement.

7. Existing Agreements for Service or Maintenance of Common Property: Any existing agreements in writing for service or maintenance of the Common Property or any part thereof are annexed hereto together with a schedule of the cost thereof to each proprietor on the basis of the unit entitlement. Where an existing Agreement for such service or maintenance of the Common Property has been entered into but is not in writing then details thereof are annexed hereto together with a schedule of the cost thereof to each proprietor on the basis of unit entitlement.

Signed on the day abovenamed for and on behalf of the original proprietor by a Director duly authorised for that purpose:

The Ninth Schedule concludes the matters with which the contract deals. Immediately following the schedule and on the same page appears the testimonium as follows:

In Witness Whereof this agreement has been executed by the parties on the day and year first hereinbefore written.

Signed by and on behalf of the Vendor in the presence of: For and on behalf of Brisbane Unit Development Corp. Pty. Ltd. (Sgd) M. Bradford (Sgd) L. Ferro A director duly authorized. Signed by the Purchaser in the presence of: (Sgd) V. Thackeray (Sgd) J. Thackeray (Sgd) K. Schulz

Vendor's Solicitors: J. D. Johnson & Co., 8th Floor, M.L.C. Building, Cnr. George and Adelaide Steets, Brisbane. Phone: 229 6811.

The appellants argue that the respondent has failed to give to the purchaser a statement in writing in compliance in every respect with the requirements of the section. They contend that the statement must be self-contained save to the extent permitted by pars. (c), (d) and (e) of s. 49(2). That being so, they look to the Ninth Schedule and say (a) it does not, as required by s. 49(2)(b), state the address of the original proprietor; (b) it does not set out, and is not accompanied by, the proposed by-laws, as required by s. 49(2)(e); (c) the date shown on the statement was not, as required by s. 49(2)(f), the date on which it was given; and (d) it was not, as required by s. 49(2)(g), signed by the original proprietor or on its behalf by a person authorized in writing by it. It will assist in understanding points (c) and (d) to explain that the contract of sale, including the Ninth Schedule, was sent to Deming under cover of a letter dated 13 August 1981 in order that it might be executed by it. At that time the schedule was signed only by Mr. Bradford, the Sales Manager for the project. It was dated 13 August 1981. The contract was thereafter signed by the directors of Deming, following the correction of a typographical error therein to its name, and returned to the respondent for completion. Mr. L. Ferro, a director of the respondent duly authorized in that behalf, then signed the contract and, presumably, added his signature to the Ninth Schedule at the same time. The contract was dated 25 August 1981 and the original copy was forwarded to Deming under cover of a letter dated 28 August 1981.

The first question is whether s. 49 requires that the statement be self-contained save to the extent permitted by pars. (c), (d) and (e) of s. 49(2). In approaching that question it is instructive to refer to provisions, broadly comparable and directed to the protection of a purchaser, which are contained in the Auctioneers and Agents Act 1971 Q., as amended. Section 66 of that Act requires, inter alia, an auctioneer who sells by auction to give to the purchaser "a statement in writing in compliance in every respect with the requirements of this section". Section 66(2) describes the content of the statement and concludes with the words: "and shall not contain any other written, typewritten, or printed matter whatsoever except the letterhead, if any, of the auctioneer " The statement, which must be given to the purchaser before he signs any contract (s. 66(3)), is in substance concerned with representations as to the availability of finance but it must nevertheless comply with statutory requirements which are virtually identical in terms to those contained in s. 49(2)(a), (b), (f) and (g) of the Act. Section 66(4) of the former Act confers on a purchaser a right to avoid the contract in certain circumstances when finance is not made available in compliance with a representation, but concludes with the words: "but a contract shall not be subject to voidance under this subsection by reason only of non-compliance in any respect with any such representation, promise or term that is a non-compliance in a matter of form and not of substance and that is not likely prejudicially to affect the purchaser." A failure to give the statement required by s. 66(1) does not give the purchaser a right to avoid the contract: cf. also the provisions of s. 67A(2) and (3).

The provisions to which I have referred in the Auctioneers and Agents Act leave no doubt that the statement to which they refer must be self-contained. It must not contain any other matter whatsoever apart from the letterhead. There is no similar provision in the Act with which we are concerned. Furthermore, there is no counterpart in the former statute to s. 49(3)(b) of the Act which provides, as an alternative to the giving of the statement to a purchaser before any contract is signed, that it may form part of the contract.

This contrasting of the Act with the former statute is persuasive of the conclusion that a s. 49 statement need not be self-contained, at least when pursuant to s. 49(3)(b) it forms part of the contract. There is nothing in the provisions of the Act which points to a different result. On the contrary, it is in my opinion the only sensible view. The very strictness of the obligation imposed upon the original proprietor by s. 49(1) would be intolerable if "compliance in every respect with the requirements of this section" was not open to be satisfied by an advertence to the contract as a whole. Several of the formal requirements of s. 49(2) serve an essential role if, pursuant to s. 49(3)(a), the statement is to be given to the purchaser independently of the contract so that it does not form part of it. In that event it is necessary for the names and addresses of the original proprietor and the purchaser to be provided for purposes of identification and to facilitate communication and for the document to be authenticated by an authorized signature. Likewise, the date serves a natural and useful purpose. But if, pursuant to s. 49(3)(b), the statement is to form part of the document which is to bind the purchaser legally in respect of the sale then the functions of identification and communication and of authentication and date are necessarily performed by the documentation as a whole. There cannot possibly be any prejudice to the purchaser if the address of the original proprietor appears on the first page of the contract rather than on the last page. Nor can there be any prejudice if the contract, including the s. 49 statement, is executed once and for all by the signature of the original proprietor appearing at the end of the document. There is a problem, in relation to the requirement of a date pursuant of s. 49(2)(f), because of the ambiguity of the word "given". I will discuss that problem separately. But consider the converse of the situation I have described. It would mean that the failure to include the address of the original proprietor within the Ninth Schedule - a failure of no possible consequence whatsoever to the purchaser having regard to the fact that the address of the original proprietor's solicitors appears on the same page and its own address on the first page - would confer on the purchaser a right to avoid the contract even perhaps, on one view of the meaning of s. 49(5), after settlement and registration of the transfer (cf. s. 49(8)). The Act would provide no escape from such a harsh result. It does not contain a proviso such as appears in s. 66(4) of the Auctioneers and Agents Act to which I have referred excluding non-compliance in a matter of form and not of substance and unlikely prejudicially to affect the purchaser from those matters which may attract the avoidance of the contract.

There is a further consideration which weighs against the conclusion for which the appellants contend. It will be noted that the three paragraphs of s. 49(2) - pars. (c), (d) and (e) - which describe the information which is to form the substance of a s. 49 statement all permit the information to accompany the statement rather than be contained within it. This means that even if the statement were required to be self-contained or capable of separate identification that essential information which forms its substance could be provided separately. And if provided separately, why not anywhere within the contract of which it forms part?

For these reasons I reject the contention of the appellants that a s. 49 statement must be self-contained even when it forms part of the contract. It follows from this conclusion that the respondent is not confined to the Ninth Schedule when called upon to prove that the statement was duly given. That Schedule does not state the address of the original proprietor. The meaning of the word "address" is apparent from its context in the Act: Blackwell v. England [13] . It has no necessary connexion with the residence of an individual proprietor or the registered office or place of business of a company. It is the place where communications may be received, the place to which notices may be sent. In the present case, there is a city address of the registered proprietor stated on the first page of the contract and on the last page the address of its solicitors is shown. Either address satisfies the requirements of s. 49(2)(b).

It is unnecessary to determine the appellants' complaint concerning the signature or signatures which appear within the Ninth Schedule. It is not suggested that Mr. L. Ferro, a Director of the respondent company, was not authorized to execute the contract in the name of the company. The due execution of the contract which includes the statement required to be given by s. 49 is a sufficient compliance with par. (g) of s. 49(2). In any event, I am not to be taken as casting any doubt on the capacity of either Mr. Bradford who was the Sales Manager or Mr. Ferro as the Director in charge of the project to sign the s. 49 statement. No significance attaches to the fact that only Mr. Bradford had signed the schedule when it was sent to Deming on 13 August 1981 because assuming that only Mr. Ferro was qualified to sign it he did so when the contract was executed. As I have said, this was the operative time when the s. 49(3)(b) statement came into existence.

I have referred to the difficulty of construing par. (f) of s. 49(2). What is meant by "the date on which the statement is given"? Elsewhere, the section speaks of the obligation of the original proprietor to "give to the purchaser" the written statement. Again, I think the difficulty is diminished when the statement forms part of the contract because it must necessarily have come to the purchaser's attention by the time the contract is completed. But I would think that it is investing too much significance in the statutory provision to require that it actually reach the hands of a purchaser before it can be "given" to the purchaser. If that were the requirement, it would often not be possible for a statement to "state the date on which the statement is given" unless the vendor actually handed it to the purchaser. The paragraph cannot mean that a vendor, before dispatching a statement to a purchaser has to speculate on when it will be received by the purchaser and then enter that date on the statement. In my opinion, the notion of "give" and "given" in s. 49(1) and (2) imports the necessity of a commitment to the statement by an original proprietor. It is not enough that a statement is prepared and completed in all its parts. It could then be put in a drawer and clearly would never have been "given". But if a statement is completed and dispatched to the purchaser then prima facie it has been "given" within the meaning of s. 49(1), notwithstanding that the purchaser may not yet have received it. I would add that the context may require a more specific meaning to be given to the phrase "given to the original proprietor" in s. 49(4) and (5) dealing with the right of the purchaser to avoid the contract. The circumstances which will give efficacy to the exercise of such an important right must be clearly identified and this may require that the notice actually reach the original proprietor within the prescribed thirty days. It is unnecessary to pursue the matter in this case.

There remains some difficulty in applying this construction of par. (f) to the facts of the present case. The Ninth Schedule bears within it the date 13 August 1981, this being the date when the contract, including the Schedule was sent to Deming for signature. If that Schedule were to be regarded as a s. 49(3)(a) statement then it would state the date on which it was given and so comply with the paragraph. Nevertheless, it was clearly intended to form part of the contract and consequently it commenced a fresh existence as a s. 49 statement on the date when the contract came into force. Presumably this would have been on 25 August 1981, the date which appears on the first page of the contract and conforms to the date when the directors of the respondent added their signatures. In my opinion, the resultant conflict between the date appearing in the Ninth Schedule and the date on which effect is given to s. 49(3)(b) must be resolved in favour of the latter. The former is superseded by the latter. In these circumstances I do not think it can be said that there is a failure to comply with s. 49(2)(f).

It remains to consider, on this part of the case, the appellants' contention that the statement does not set out, and is not accompanied by, the proposed by-laws: cf. s. 49(2)(e). As has been seen, the Ninth Schedule, in par. (5), refers to the Third Schedule of the contract. That Schedule, in pursuance of cl. 8(h) of the contract, sets out the by-laws which the original proprietor proposes that the body corporate will make on registration of the building units plan in supplementation of the by-laws contained in the Third Schedule to the Act. Those latter by-laws are declared by s. 30 of the Act to be the by-laws in force in respect of each plan except as is provided in the section. The section empowers a body corporate in the circumstances mentioned therein to make by-laws amending, adding to or repealing the by-laws set forth in the Third Schedule. The by-laws set forth in the Third Schedule to the Act are not set out anywhere in the contract.

The respondent argues that the Ninth Schedule when read with the remainder of the contract sufficiently incorporates by reference the by-laws to which s. 49(2)(e) refers. It relies upon what is said to be common drafting practice in Queensland. Reference is made to several statutes which effect a repeal of earlier statutes by a provision which reads "The Acts set out in the First Schedule are repealed". Invariably, the schedule referred to does not contain the whole of the statutes which are intended to be repealed. It merely recites the short titles of the Acts in question. However, I do not think the analogy is a good one. What the repealing section is clearly saying is "The Acts the short titles of which are set out ". The citation of an Act by its short title is the recognized mode of describing a statute and has the statutory backing of the Acts themselves and the interpretation statutes. There is no purpose whatever to be served by referring to the repealed statutes other than by their short titles.

However, the purpose of s. 49(2)(e) is clearly to inform the prospective purchaser of all the by-laws that apply or are proposed to be applied to the property. It is true that the statement draws attention to the supplementary by-laws which it is proposed should be made by the body corporate and those by-laws are set out in the Third Schedule of the contract. It is no answer to say that the by-laws which are not set out are to be found in a public Act. Of course the purchaser could not seek protection from the application of a statute to him in his ignorance of its provisions. But he is not presumed to know the law: Iannella v. French [14] ; Reg. v. Mayor of Tewkesbury [15] .

1. (1968) 119 C.L.R. 84, at pp. 112-113. 2. (1868) L.R. 3 Q.B. 629, at p. 635.

Furthermore, here we are concerned with a positive duty imposed upon an original proprietor to set out the by-laws in the statement or in an accompanying document. Such a requirement has an important place in the protection which it is the purpose of the section to provide to a purchaser. The statutory by-laws may not merely be supplemented; they may be amended or repealed. A purchaser should not be expected to refer to the Act in order to sort it all out for himself. I am unable to read the paragraph in any way that would not require in the present case all the by-laws which are to apply to the property to be set out either in the schedule or elsewhere in the contract or in an accompanying document. I conclude therefore that the respondent failed to comply in this respect with s. 49(1).

It is necessary now to consider the consequences of a failure by the original proprietor to comply with s. 49(1). Section 49(5) provides that, given a non-compliance, the purchaser may avoid the contract "by notice in writing given to the original proprietor within 30 days after he first becomes aware of the failure". The construction of the phrase "after he first becomes aware of the failure" is of critical importance to the operation of the section. I agree with the view taken in successive cases by the Full Court (see, e.g., Sunbird Plaza Pty. Ltd. v. Boheto Pty. Ltd. [16] ) that the relevant awareness is of the facts which constitute the failure and not of the impact of the law upon those facts. Any other view is in my opinion quite untenable. However, it seems to have been accepted by the Court, and by the parties in the present case, that the phrase must always be read literally, with the result that awareness will require actual knowledge in every case. It is said that if a purchaser for the first time actually becomes aware of an omission in the statement provided to him pursuant to s. 49(1), months or even years after entry into the contract and even after the registration of the transfer then he may avoid the whole transaction. I must confess that such an operation of the section is not immediately evident to me. I appreciate its benevolent purpose in the interests of consumer protection. But the pursuit of that purpose does not require that a prospective purchaser be cosseted like a spoilt child and protected against his own blindness.

The problem is one of statutory construction. I think there are clear indications in the context of s. 49(5) that the literal meaning of the words does not wholly reflect the intention of the legislature. Reference must be made to the requirement in s. 49(4) that in the case of a material alteration to the prescribed particulars that occurs after the giving of the notice then the purchaser may void the contract by notice given "within 30 days of the date of receipt by him of the notice given by the original proprietor". In such a case it would not avail a purchaser that he did not read the notice of the alteration. Of course a different form of words is to be expected in s. 49(5) in order to accommodate the range of matters as to which there may be a failure on the part of the original proprietor. At least four different kinds of failure may be contemplated: first, a failure to give to a purchaser any statement at all as required by s. 49(1), (2) and (3); second, an evident failure to give a complete statement; third, a failure to give an accurate statement; finally, a failure to give a notice prescribed in s. 49(4). In the third and fourth cases, it will often be the case that the purchaser will have no knowledge and could not be expected to have knowledge of the failure when it first occurs. In such cases, it is simply a question of fact as to when he first became, or ought reasonably to have become, aware of the failure. In the first and second cases, however, there is necessarily the occurrence of an event which objectively declares the failure of the original proprietor. In the first case it is the signing by the purchaser of "any contract, agreement or document whatsoever legally binding or intended to bind the purchaser legally in respect of the sale" (s. 49(3)). In the second case, it is the giving of a statement to the purchaser by the original proprietor (s. 49(1)). It seems to me that to apply the literal meaning of the phrase in question to the first and second cases is to produce an absurdity, when compared with the operation of s. 49(4). In all three cases the purchaser actually receives a statement but a literal meaning would mean that while a purchaser, regardless of his actual knowledge, is limited to a period of thirty days from the date he receives the s. 49(4) notice in which to seek to avoid the contract there is no such limitation operating upon him in the absence of actual knowledge in cases where either the contract is completed without his receiving any statement in compliance with s. 49(1) or where he receives a statement which is patently inadequate. Yet the matters with which s. 49(4) are concerned are likely to be of much greater moment to the purchaser than much of the formal information which is required to be included in a s. 49(1) statement. In my opinion, such a construction should not be adopted if there is any reasonable alternative. There is such an alternative available. It lies in construing the phrase to encompass both actual and constructive knowledge. It is to be read as identifying a point of time when the purchaser either first becomes aware or ought to have become aware of the failure.

The section, inter alia, seeks to ensure that all information that is necessary to an informed transaction is supplied to a prospective purchaser. The function that a statement is designed to serve would, in the ordinary course of events, be largely spent when the contract is executed. Of course it may assume a continuing significance if it conveys erroneous information or if, before the registration of the purchaser as the proprietor of the lot, there is a variation in the circumstances described in the statement which will bring s. 49(4) into play. But where an original proprietor fails to comply with s. 49(1) by reason of the fact that the statement omits certain of the information which s. 49(2) requires to be included, and that omission is apparent on the face of the document, then it seems to me that the prospective purchaser must be taken first to become aware of the failure at the time when he receives the document. I take the meaning of "aware" to be "informed" or "cognizant": cf. Shorter Oxford English Dictionary, 3rd ed. (1973), vol. 1, p. 139. When the prospective purchaser receives a s. 49 statement, he not only is informed of its contents but also of a failure to state those things which are patently absent. Hence, if a statement fails to record the address of one of the parties or the date or is not authenticated by a signature or the by-laws are not set out the omission is immediately apparent and the purchaser cannot claim that he did not become aware of it at the time when he received it. It follows from this view of s. 49(5) that Deming first became aware of that non-compliance which was evident from a perusal of the contract in August 1981 when the executed copy was received. If it wished to take advantage of that failure and to avoid the contract it had to do so within thirty days of that time. This was not done.

As I have said, the appellants also claim that they should have been given leave to defend the action because, inter alia, they had raised an issue deserving to be tried concerning the material effect upon them of a change in lot entitlement between the date of contract and the registration of the building plan. It is common ground that at the time of contract the proportionate lot entitlement of Deming was 1/41 of the aggregate of lot entitlements and that at the date of registration of the building units plan it was 1/37 of such aggregate. This change in lot entitlement obliged the vendor, pursuant to s. 49(4)(d), forthwith to give to Deming notice in writing of the full particulars thereof. It is also common ground that the respondent failed to give such a notice to Deming. In those circumstances, s. 49(5)(b) entitles the purchaser to void a contract by notice in writing given to the original proprietor within thirty days after he first becomes aware of the failure provided that he proves that his rights have been materially affected by the change in lot entitlement.

Section 19 of the Act provides that the lot entitlement of each lot shall determine (a) the voting rights of proprietors; (b) the quantum of the undivided share of each proprietor in the common property; (c) the proportion payable by each proprietor of contributions levied pursuant to s. 32. The words "materially affected" in s. 49(4) and (5) would seem to bear their ordinary meaning, which I take to refer to a consequence of any other changes particularized in the lettered paragraphs in s. 49(4) which operates to the prejudice of a purchaser to a significant extent. It must be a question of fact and degree whether there is such an effect in any particular case. The relevant prejudice upon which the appellants rely is the exposure of Deming, by reason of the change in lot entitlement to an increase of 10.81 per cent in its liability to pay the contributions levied pursuant to s. 32. The evidence placed before the learned primary judge (McPherson J.) in respect of this matter is very limited. By affidavit dated' 11 October 1982 Mr. Quinn, the solicitor acting for the appellants, testifies to the fact of the change in lot entitlement and to a conversation on 8 October 1982 with one of the directors of Deming as a result of which a telex was sent on 8 October to the solicitors for the vendor. The telex included the following paragraphs:

We have only just ascertained that the lot entitlement of our client's lot and the aggregate lot entitlement disclosed in the B.U. Plan as registered differs from that in the contract. Our client is materially affected by the change as it will be forced to bear an increased proportion of contributions.

We are instructed that notwithstanding this change no notice pursuant to s. 49(4) of the Building Units and Group Titles Act has been received from your client.

Our client hereby notifies you in writing pursuant to s. 49(5) of the Building Units and Group Titles Act that as a result of the change in lot entitlement and aggregate lot entitlement our client voids the agreement between our respective clients.

The primary judge expressed his conclusion as follows:

However, although such a percentage increase is not negligible, I have no means of knowing whether the contributions payable in respect of a building such as "North Shore" are or are likely to be large or small, and accordingly no means of determining whether the increase in contribution is capable of being regarded as "materially affecting" the defendants' rights as proprietors. (The reference to defendants and proprietors in the plural is explained by the fact that the learned judge was hearing several cases together.) His Honour then referred to the purchase price of Deming's lot of $182,000 and said it was probably unlikely that an increase by 10 per cent or 11 per cent in the contribution payable could fairly be said to affect in a material way a purchaser who was prepared to commit himself to a capital outlay as large as that involved in the contract.

In the Full Court, Connolly J., with whose reasons Douglas and Sheahan JJ. agreed, observed that the learned judge felt able to come to an affirmative conclusion that the rights of the appellants had not been materially affected and said that for himself he should have had greater difficulty. However, the Court rejected this ground of the appeal for the reason that the appellants had not attempted to lay any factual basis for the contention.

Several matters require to be considered in relation to this ground of the appeal. The first is whether the telex message of 8 October 1982 constituted an effective notice in writing given to the respondent within thirty days of Deming first becoming aware of the former's failure to give notice of the change in lot entitlement. A difficulty may arise because of the paucity of evidence as to when Deming first became aware of the failure. Even if one accepts the hearsay evidence contained in Mr. Quinn's affidavit, the fact remains that it does not appear when he himself first became aware of the change. An earlier affidavit by him shows that he received instructions with respect to the avoidance of the contract for non-compliance with s. 49 early in June 1982. The building units plan was registered on 23 June 1982 and Mr. Quinn was advised promptly of that fact. It does not appear when Mr. Quinn first perused the plan. It seems to me that in the circumstances it was necessary for the appellants to establish not only when Deming first became aware of the change but also when its solicitor did so. In my opinion any knowledge on the part of Mr. Quinn is to be imputed to Deming: Sargent v. A.S.L. Developments Limited [17] . I suppose that slender evidence of the timeliness of the notice avoiding the contract may be gleaned from the statement in the notice itself that "We have only just ascertained" that the lot entitlement has changed.

The second matter requiring consideration is whether, in the circumstances, an increase of almost 11 per cent in Deming's proportionate liability in respect of levies made by the body corporate is capable of materially affecting Deming's rights as a purchaser. It is suggested by the respondent that the material affectation must be traced, not to the change in lot entitlement itself but to the failure to give the notice required by s. 49(4). The suggestion is prompted by the concluding phrase of the proviso to s. 49(5). In my opinion there is no substance in the suggestion. The proviso is referring to "a matter referred to in" par. (b) of s. 49(5) and that matter is the notice of the changed circumstance required to be given by s. 49(4), not the failure to give the notice. The test of material affectation must be the same whether it is raised in answer to a notice duly given by an original proprietor pursuant to s. 49(4) or consequent on a failure to give the notice.

With all respect to the learned primary judge, I think an 11 per cent increase in contributions is capable of materially affecting the rights of Deming. The development was clearly a luxury one. The brochure which was tendered in evidence suggests that the grounds are spacious and it refers to a heated pool, spa, saunas and gym. Having regard to the provisions of ss. 32 and 38 of the Act, the expenses of the body corporate in fulfilling its responsibilities with respect to the property could well be substantial. They would require to be met by contributions from the proprietors of the lots comprising the project in proportion to their lot entitlement. But no doubt it is true that mere quantum is not the only criterion. Its significance must be judged in the light of all the circumstances and the higher the contract price the less may be the impact which an increase in lot entitlement, even of 11 per cent, would have on a prudent purchaser. In an earlier case, Bassingthwaighte v. Butt [18] , McPherson J. offers an objective test of materiality, namely, whether the possibility that the purchaser might not have purchased is a reasonable supposition. His Honour refers to Stonham, Vendor and Purchaser, pars. 373 and 374. If that is an appropriate test, then I would agree with his Honour that the possibility that Deming might not have purchased the property had its lot entitlement been represented as 1/37 instead of 1/41 is not a reasonable supposition. However, we are not applying equitable doctrines. We are construing a statute which reflects a firm resolve on the part of the legislature to protect the purchasers of home units with quite specific statutory remedies. Section 49(4) contemplates that there will be circumstances which are capable of materially affecting the rights of purchasers. These circumstances encompass the entry into or variation of a management agreement or service agreement, the making or variation of a by-law or a change in the lot entitlement of any lot or the aggregate lot entitlement. Of course, it would be quite unjust if minor changes or adjustments in these areas were to entitle a purchaser to avoid a contract. On the other hand, if the changes are not insignificant and have the effect of changing the substance of that contracted for, the intention of the legislature would seem to be plain. In the present case, Deming was clearly entitled to be informed promptly of the change in lot entitlement and the question of material affectation could reasonably have been raised by Deming had it wished them to avoid the contract on that ground.

The third matter calling for consideration in relation to this aspect of the appeal is the question of evidence. The Full Court rejected this ground of appeal on the ground that the appellants had failed to adduce any evidence to show that Deming's rights had been materially affected by the change in lot entitlement. I have not found this question an easy one to resolve. In the end I have resolved it against the appellants. In the proceedings before the primary judge, the respondent sought an order for summary judgment pursuant to O. 18a of the Supreme Court Rules. Rule 3 of that Order clearly places the onus on the defendant to satisfy the judge that "there is an issue or question in dispute which ought to be tried". In such a case, there is an obligation on a defendant to "condescend upon particulars" as Lord Blackburn observed in Wallingford v. Mutual Society [19] ; cf. also Cloverdell Lumber Co. Pty. Ltd. v. Abbott [20] ; Fancourt v. Mercantile Credits Ltd. [21] . Virtually the only evidence adduced by the appellants to discharge this onus consisted of the bare facts surrounding the purported avoidance of the contract on this ground. There was no attempt to show the likely effect of an 11 per cent increase in liability for contributions. The primary judge was not given a relevant description of the common property and the likely financial responsibilities of the body corporate for which it would be obliged to levy contributions. No estimate was made of the likely amount of the levies that were to be expected. As the materials stand at present, it would be sheer speculation to conclude that there is a serious issue to be tried. In these circumstances there is no escape from the conclusion that the appellants have failed to discharge the onus placed upon them by r. 3.

1. (1880) 5 App. Cas. 685, at p. 704. 2. (1924) 34 C.L.R. 122. 3. (1983) 154 C.L.R. 87, at p. 98.