CONVEYANCING – STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO
CONTRACT FOR SALE – PROTECTION OF PURCHASERS –
OBLIGATIONS ON
VENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS – where the applicant
Source
Original judgment source is linked above.
Catchwords
CONVEYANCING – STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TOCONTRACT FOR SALE – PROTECTION OF PURCHASERS –OBLIGATIONS ONVENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS – where the applicantentered into a contract to purchase property– whether theapplicant’s attention had been directed to a warning statement inaccordance with s 365(2A)(c) of the Property Agents and Motor Dealers Act2000 – whether the applicant was entitled to terminate thecontractCONVEYANCING – STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TOCONTRACT FOR SALE – PROTECTION OF PURCHASERS –OBLIGATIONS ONVENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS – where the disclosurestatement provided to the applicant bythe respondent did not contain serviceslocation diagrams or an exclusive use plan – whether the disclosurestatement was substantiallycomplete as required pursuant to s 213 of theBody Corporate and Community Management Act 1997 (“BCCMA”)
– whether the applicant is entitled to avoid, not complete or cancel the
contract
CONVEYANCING – THE CONTRACT AND CONDITIONS OF SALE –
DESCRIPTION OF PROPERTY AND SUBJECT MATTER OF SALE – GENERALLY
–where the contract property for sale was described as “Proposed Lot
51 on proposed SP 207070, as highlighted on the
Identification Plan contained in
the Disclosure Documents” – where there was no proposed “SP
207070” in existence
– where a “proposed building plan”
was attached to the contract which included documents “intended only to
represent an indicative development plan” – whether the contract
clearly identified the lot to be purchased – whether
the contract is void
for uncertainty
CONVEYANCING – STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO
CONTRACT FOR SALE – PROTECTION OF PURCHASERS –
OBLIGATIONS ON
VENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS – whether the disclosure
statement clearly identified the lot
to be purchased as required pursuant to s
21(1)(a) of the Land Sales Act 1984 – whether the applicant
is entitled to avoid, not complete or cancel the contract
CONVEYANCING
–– STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO CONTRACT FOR
SALE – PROTECTION OF PURCHASERS –
OTHER MATTERS – where s 212
of the BCCMA at the relevant time provided that a contract for the sale of a lot
intended to come
into existence as a lot in a community titles scheme must
provide that settlement must not take place earlier than 14 days after the
seller advises the buyer that the scheme has been established
– where the
contract contained a similar, but not identical provision – whether the
contract complied with s 212 –
whether the applicant is entitled to cancel
the avoid, not complete or cancel the contract
Body Corporate and Community Management Act 1997, s 66(1)(b),
s 66(1)(d), s 66(1)(f), s 212, s 213
Land Sales Act 1984, s 21(1)(a),
s 25
Property Agents and Motor Dealers Act 2000, s 365(2A)(c)
Bossichix Pty Ltd v Martinek Holdings Pty Ltd [2009] QCA
154, cited
Mirvac Queensland Pty Ltd v Horne [2009] QSC 269,
considered
Hudpac Corporation Pty Ltd v Voros Investments Pty Ltd
[2009] QSC 275, cited
Judgment (88 paragraphs)
[1]
CONVEYANCING - STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO CONTRACT FOR SALE - PROTECTION OF PURCHASERS - OBLIGATIONS ON VENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS - where the applicant entered into a contract to purchase property - whether the applicant's attention had been directed to a warning statement in accordance with s 365(2A)(c) of the Property Agents and Motor Dealers Act 2000 - whether the applicant was entitled to terminate the contract
[2]
CONVEYANCING - STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO CONTRACT FOR SALE - PROTECTION OF PURCHASERS - OBLIGATIONS ON VENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS - where the disclosure statement provided to the applicant by the respondent did not contain services location diagrams or an exclusive use plan - whether the disclosure statement was substantially complete as required pursuant to s 213 of the Body Corporate and Community Management Act1997 ("BCCMA") - whether the applicant is entitled to avoid, not complete or cancel the contract
[3]
CONVEYANCING - THE CONTRACT AND CONDITIONS OF SALE - DESCRIPTION OF PROPERTY AND SUBJECT MATTER OF SALE - GENERALLY -where the contract property for sale was described as "Proposed Lot 51 on proposed SP 207070, as highlighted on the Identification Plan contained in the Disclosure Documents" - where there was no proposed "SP 207070" in existence - where a "proposed building plan" was attached to the contract which included documents "intended only to represent an indicative development plan" - whether the contract clearly identified the lot to be purchased - whether the contract is void for uncertainty
[4]
CONVEYANCING - STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO CONTRACT FOR SALE - PROTECTION OF PURCHASERS - OBLIGATIONS ON VENDOR: DISCLOSURE, WARNINGS AND LIKE MATTERS - whether the disclosure statement clearly identified the lot to be purchased as required pursuant to s 21(1)(a) of the LandSales Act 1984 - whether the applicant is entitled to avoid, not complete or cancel the contract
[5]
CONVEYANCING -- STATUTORY OBLIGATIONS OR RESTRICTIONS RELATING TO CONTRACT FOR SALE - PROTECTION OF PURCHASERS - OTHER MATTERS - where s 212 of the BCCMA at the relevant time provided that a contract for the sale of a lot intended to come into existence as a lot in a community titles scheme must provide that settlement must not take place earlier than 14 days after the seller advises the buyer that the scheme has been established - where the contract contained a similar, but not identical provision - whether the contract complied with s 212 - whether the applicant is entitled to cancel the avoid, not complete or cancel the contract
[1] Douglas J: The applicant was the purchaser of an apartment in a building called "Delor Vue Apartments" built by the respondent Delorain Pty Ltd. The contract, made in September 2007, was for the sale of unit 51 in the apartments which was described as "Proposed Lot 51 on proposed SP 207070, as highlighted on the Identification Plan contained in the Disclosure Documents".
[14]
[2] The applicant seeks declarations that the contract is void for uncertainty and that it has been terminated for failure to comply with s 365(3) of the Property Agents and Motor Dealers Act 2000 ("PAMDA"). As the case was argued, however, the applicant relied not on an alleged breach of s 365(3) of PAMDA but on an alleged breach of s 365(2A)(c) of that Act. She also argued that she was entitled to avoid it or not complete it or cancel it for non-compliance with s 21 of the Land Sales Act 1984 ("LSA") or s 212 or s 213 of the Body Corporate and Community Management Act 1997 ("BCCMA").
[15]
[3] The contract was accompanied by an identification plan contained in disclosure documents annexed to it and signed by the applicant which identified lot 51 as part of stage 3 of the development envisaged on the proposed community titles scheme land. There was no proposed "SP 207070" then in existence. There was a "proposed building plan" attached which included documents that would more properly be described as a concept plan "intended only to represent an indicative development plan for the scheme land ... annexed for illustrative purposes only" and which did not "accurately fix or specify the location of buildings or the boundaries of buildings, all of the same being subject to a final survey being undertaken after the completion of all relevant civil works and landscaping works to be progressively undertaken on the scheme land and as each stage is completed."[1]
[16]
[4] It was intended, apparently, that there be a concept plan set out as annexure X to schedule B of the contract but the building format plan that was annexed was not labelled with the letter "X". Nonetheless it can be described as a concept plan and was said by the respondent to be a community management statement pursuant to s 66(1)(f) of the BCCMA illustrating the proposed development by concept drawings. It included illustrative diagrams highlighting lot 51 as part of "Building J" and associated with concept drawings showing the number "51" in two rectangles admittedly referable to the proposed unit and an associated car park. One significant criticism made of it was that it was insufficiently detailed for the purposes of the Act.
[17]
[5] A preliminary issue was whether a first attempt by the applicant to terminate the contract in reliance on s 365 of PAMDA was effective. Then there was some criticism made of the plan scheduled to the contract that it failed to identify whether the car park was part of the title to the lot or the subject of an exclusive use agreement. Another criticism was that the community management statement did not include services location diagrams. The documentation was said to be inadequate in failing to inform the proposed lot holder properly of the details of the exclusive use areas of the common property. These issues were said to result in the contract being uncertain. A final issue related to the applicability of s 212 of the BCCMA.
[18]
The first attempt at termination of the contract pursuant to s 365 of PAMDA
[19]
[6] The applicant purported to terminate the contract at first on 24 November 2008 for the respondent's alleged failure to comply with s 365(2A)(c) of PAMDA by not directing the applicant's attention to the warning statement, information sheet and contract required by that legislation. That can be done by including a paragraph in an accompanying letter giving the appropriate direction. There was an accompanying letter including the appropriate direction in a bundle of documents delivered in an envelope to the applicant's solicitors on 20 September 2007. The probabilities are that the accompanying letter was the first document, on top of the others or included behind a clear plastic cover sheet and enclosing the contract. That was how Ms Danielle Cairns, the lady who prepared the documents, normally organised them and she was aware of the importance of providing that document. The document was headed "Cover Page Statement" and the vendor's copy was received by it in that form and in that order.
[20]
[7] The envelope was delivered to the reception of the applicant's solicitors but by the time the documents were handed to Ms Davies, the relevant solicitor, it is likely that the covering letter had been inserted loosely into the middle of the bound contract. Ms Davies did not see it until she took a photocopy of the contract on 16 November 2008 when she found it in that position. It seems likely that the receptionist may have placed the letter in that position. No receptionist was called on behalf of the applicant to contradict that view of what probably occurred.
[21]
[8] Accordingly, it is my view that there has been compliance with s 365(2A)(c) of PAMDA as there was a letter accompanying the contract which directed the applicant's attention to the appropriate information and, if it matters, the letter was probably delivered to the applicant's solicitors in such a form as to direct their attention to the information effectively because, when it was delivered, it was on top of the bundle.
[22]
[9] The attempt to terminate the contract by the letter of 24 November 2008 was rejected by the respondent's solicitors on 2 December 2008. On 28 January 2009 the applicant's solicitors sent a further letter purporting to terminate the contract on a number of other grounds, namely:
[23]
failure to provide a substantially complete disclosure statement as required pursuant to s 213 of the BCCMA;
failure to clearly identify the lot to be purchased contrary to s 21 of the LSA permitting the contract to be avoided pursuant to s 25 of that Act;
misrepresentation and/or misleading or deceptive conduct;
uncertainty in the absence of the building format plan in relation to the particulars of the lot and common property.
[24]
[10] On 10 February 2009 the respondent's then solicitors, who acted in the transaction but not in this litigation, sent a further disclosure statement to the applicant's solicitors. The previous concept drawings attached to the contract had shown lot 51 in building "J". The building in the new drawings was labelled "H" but was in a similar position on the diagram. The drawings attached were more detailed scale drawings than the earlier concept drawings, identified areas of common property and again identified the lot's garage area by reference to the lot number 51.[2] The area of lot 51 was also detailed on a scale drawing.[3] The lot proposed to be conveyed included the garage as part of the lot.
[25]
[11] Section 66(1)(d) of the BCCMA requires the community management statement envisaged by that legislation to include, among other things, one or more services location diagrams for all service easements for the standard format lots included in the scheme and for the common property for the standard form lots. That was not done in the disclosure documents originally provided in this case but they did appear in the further disclosure statements.[4]
[26]
[12] Section 66(1)(f) also requires the community management statement to explain the proposed development and illustrate it by concept drawings. That seems to me to have been done here in the annexures in the disclosure statements.
[27]
[13] Section 213 of the BCCMA also requires the disclosure statement to be given by the seller to the buyer to be accompanied by the proposed community management statement and to be substantially complete.[5] Section 214 permits variation of a disclosure statement by the giving of a further statement with a right in the buyer to cancel the contract if he or she is materially prejudiced. Section 217 also permits a buyer to cancel a contract if materially prejudiced because of a difference or inaccuracy in the information disclosed in the disclosure statement. There was no suggestion in this case that the applicant was materially prejudiced by the omission to include the relevant service location diagrams.
[28]
[14] The issue, therefore, appears to be whether the omission of the services location diagrams prevented the disclosure statement from being substantially complete in the context where the concept plan was intended expressly to represent only an indicative development plan and to be subject to a final survey and no material prejudice has been shown. It also seems likely that a services location diagram was not then required by s 66(1)(b) of the BCCMA as the scheme was not one for which development approval had been given after the commencement of that paragraph.
[29]
[15] In my view the disclosure statement was substantially complete and did not permit the applicant to cancel the contract. Section 213(7) is also important in this context. Section 213(6) permits a buyer to cancel a contract not already settled if there has not been compliance with s 213(1) requiring the seller to give the buyer a disclosure statement. Section 213(7) then provides:
[30]
"The seller does not fail to comply with subsection (1) merely because the disclosure statement, although substantially complete as at the day of the contract was entered into, contains inaccuracies."
[31]
[16] In my view this disclosure statement was substantially complete as at the day the contract was entered into and the applicant was not able to cancel the contract in reliance on s 213. The omission of the services location diagram at the time of entry into the contract was not shown to be a highly significant part of the disclosure required in this case, which was evidenced by the lack of any material prejudice claimed on behalf of the applicant.
[32]
[17] Another complaint of the applicant was that there was no exclusive use plan for lots allocated exclusive use areas of common property. That was so in that that part of the disclosure statement said "nil" but that was said to be deliberate because no such plan had then been prepared and it was anticipated that there would be no exclusive use areas. That view had changed by the time the further disclosure statements were sent and they included an exclusive use plan for the common property.[6]
[33]
[18] In further written submissions made after the hearing the applicant argued that the disclosure statement did not adequately "identify the lot to be purchased" (within the meaning of s 21 of the LSA) because it did not state whether the car park allocation for proposed lot 51 was freehold or the subject of an exclusive use by-law (applicable to common property); whereas the contract provided that the applicant had the "exclusive use and enjoyment" of the car park shown in the disclosure plan.
[34]
[19] Further or in the alternative, the applicant submitted that the disclosure statement was not "substantially complete" because it failed to contain a by-law concerning the exclusive use of common property pertaining to car parks contrary to s. 213 of the BCCMA. The further argument was made that the disclosure statement was non-compliant unless it accurately depicted, by floor plan, the area of the lot to be purchased as against the common property of the scheme land.
[35]
[20] It is convenient to deal with those further submissions when I consider whether the contract was certain.
[36]
Section 21 of the LSA and certainty of the contract
[37]
[21] Section 21(1)(a) of the LSA requires a written statement to be given to a person entering upon a purchase of a proposed lot clearly identifying the lot to be purchased. A statement is also required to be given by a prospective vendor under s 213 of the BCCMA and if it incorporates the matters prescribed by s 21(1)(a) to (d) of the LSA then there is sufficient compliance with s 21(1); see s 21(6).
[38]
[22] The misdescription of the proposed lot 51 as being on "proposed SP 207070" was criticised for the applicant as a failure to identify clearly the lot to be purchased because of the reference to a non-existent plan, as was the failure to include the services location diagrams to which I have already referred.
[39]
[23] That there was a mistake in the reference to "proposed SP 207070" seems to me to be irrelevant as it should not have confused the applicant and there was no evidence that it had. If the applicant wished to examine floor plans of the unit, the disclosure statement contained instructions as to how to obtain that information from the respondent.[7]
[40]
Was the car park identified as part of the lot conveyed?
[41]
[24] The concept plan included in the disclosure statement clearly identified lot 51 and its location in the development whose address also appeared on the contract. As the respondent submitted, the lot to be purchased was identified on p 3 of the disclosure statement. It was, by reference to the cover page, "proposed lot 51" in Delor Vue Apartments, which the contract relevantly identified as including a car park. The concept plans enclosed identified the car park as being situated in the same building, depicted by a smaller rectangle. The concept plans accompanying the disclosure statement identified the location of apartment 51 in Building J and car park 51 as situated on the ground floor (or basement) of the apartment building housing apartment 51. The basement of that building contained a car park for each of the apartments. All apartments in the scheme, except for units 7, 9, 10, 11, 12, 15, 16, 17 and 20, had car parks situated under their respective buildings; whereas apartments 7, 9, 10, 11, 12, 15, 16, 17 and 20 each had exclusive use areas.
[42]
[25] The applicant's further written submission under the BCCMA appears to be that the contract did not make it clear that the car park was freehold and that, if it was not freehold, it must have been an allocation of common property for exclusive use and therefore should have been disclosed in, and should have been subject to a by-law under the disclosure statement to comply with s 213 of the BCCMA. The respondent submitted, however, that the car park was part of the lot to be purchased, as evinced by the allocation of lot 51, so that the applicant's submission was incorrect. The respondent submitted that the car park for proposed lot 51 was not an exclusive use area. It was part of lot 51.
[43]
[26] The respondent also submitted that, therefore, the exclusive use areas referred to by applicant in her further written submissions, at by-law 44 (Sch C) and in Sch E, as being omitted are irrelevant because they did not apply to lot 51. The exclusive use areas contained in Schedule E to the further disclosure statement, it was submitted, were self-evidently areas allocated for "car parking" entitlements for units which did not have basement allocations, being apartments 7, 9, 10, 11, 12, 15, 16, 17 and 20.
[44]
[27] The respondent also submitted that this aspect of the applicant's argument proceeded on the fallacy that a developer is required to disclose both exclusive use areas which have not yet been ascertained and by-laws intended to apply to such areas whether or not they come into existence and that nothing in the BCCMA or the applicable regulations required exclusive use areas to be identified and applicable by-laws to be included in relation to areas which have not yet been ascertained. Accordingly, Mr Handran for the respondent submitted that it did not follow that, because the further disclosure statement made provision for exclusive use areas of common property for car parking entitlements for apartments 7, 9, 10, 11, 12, 15, 16, 17 and 20, that the original disclosure was inaccurate.
[45]
[28] On a proper reading of the contract it seems clear to me that lot 51 always included the car park as part of the lot and that it was sold on that basis. That was why the diagram identified the car park with the lot number. Accordingly, I agree with the respondent's submissions that any omission of exclusive use areas related to other lots was irrelevant to the disclosure required to be made to the applicant. Those submissions included an argument that the contention advanced by the applicant would, if accepted, have the consequence that a developer could not, following the original disclosure, allocate exclusive use areas of common property without the risk of vitiating any contracts previously procured. The respondent submitted that the better view, and the one more consistent with the consumer protection objects of the BCCMA, was that such exclusive use areas may be allocated subsequently and disclosed by a further disclosure statement, which, upon receipt, entitles the buyer to vitiate the contract only in the event of "material prejudice". Here, the respondent submitted accurately that there was no evidence of material prejudice, nor was there evidence of any attempt by the applicant to terminate the contract on that basis.
[46]
Is a building format plan required at the stage of initial disclosure?
[47]
[29] The applicant also relied on directions for the preparation of building format plans prepared by the registrar of titles for a specification of what should be done to identify lot numbers and common property and argued that it was essential to delineate the common property at the stage of entry into the contract. Mr Morgan, for the applicant, submitted that the concept plans in the first disclosure statement annexed to the contract did not delineate the common property. He argued, by reference to a text book that the common property should be defined with certainty in the contract by reference to a draft of the full survey plan prepared from the proposed building plans.[8] The author recognises, however, that in many cases draft floor plans are all that are available.[9]
[48]
[30] The applicant's argument that the identification of the lot required the contract to refer to a building format plan in the disclosure statement in the form required at the time of registration of a plan of subdivision does not appeal. The form of the plan required for registration of the plan of subdivision is that required when the lot defined in the plan is created. It is not required for the recording of the community management scheme which is a distinct step apparently performed in practice immediately upon registration of the relevant plan.[10]
[49]
[31] The decisions referred to in the applicant's further written submissions of Mirvac Queensland Pty Ltd v Horne[11] and Hudpac Corporation Pty Ltd v Voros Investments Pty Ltd[12] do not require a different conclusion. In Mirvac, Applegarth J said:[13]
[50]
"[34] The defendants rely on the floor area of the lot as recorded on Sheet 10 as something that identified the lot to be purchased. There is a compelling argument that the floor area of the unit is part of 'describing and identifying the precise compartment of air space into which the constructed unit will fit'. The competing argument is that the Disclosure Statement sufficiently and clearly identified the lot without reference to its floor area and that the lot was clearly identified by its lot number, the floor on which it was intended to be and the marking on the drawing that indicated its location on that floor and its shape.
[51]
[35] Although it may be possible to clearly identify a lot to be purchased without recording its total floor area in a statement provided under s 21 (a matter which I am not required to decide in order to determine this application) in a case such as this where the floor area is included on the plan, the better view is that the description of its floor area serves to clearly identify the lot in conjunction with other matters such as the lot number, the floor on which it is located and its position in the building."
[52]
[32] Although there was no floor plan here disclosing the detail provided in Mirvac, it seems to me that the description of lot 51 that was supplied in this contract was sufficient, a possibility that Applegarth J recognised. It detailed, as the respondent submitted, the unit number including the fact that a car park was allocated as part of the lot, the lot number, the building number and the location in which the unit was intended to be, the floor on which the unit was intended to be located, and the concept plans and elevations contained in the disclosure statement. In my view, that information clearly identified the lot to be purchased.
[53]
[33] In this context the applicant also submitted that the absence of a floor plan made it impossible to determine what the relationship of the lot was with the common property. The submission was that a disclosure statement was non-compliant unless it accurately depicted, by floor plan, the area of the lot to be purchased as against the common property of the scheme land. Attention was paid to the absence of plans depicting details such as stairwells and common walls.
[54]
[34] The respondent's submission to the contrary was that there was nothing in the BCCMA or the LSA which necessitated detailed survey plans being incorporated at the initial disclosure stage or any other plans showing the internal structures of the building in which the proposed apartment is to be built such as common walls or stairwells. That seems to me to be correct and consistent with the fact that the Act envisages that units such as these may be sold "off the plan" with purchasers' rights protected by provisions such as s 214 of the BCCMA.
[55]
[35] Under the general law relating to any innocent misrepresentation such as may have occurred here either in respect of the reference to "proposed SP 207070" or in respect of any omission of the details of exclusive areas related to other units, it is necessary to consider whether, if the truth had been made known to the applicant, it would have caused her not to enter into the contract. There is no evidence before me that these matters would have caused the applicant to take such a course.
[56]
[36] It is also important to bear in mind that, as the respondent argued, all that is required to be clearly identified by s 21(1)(a) of the LSA is the lot to be purchased. The rights and obligations in respect of common property are delineated to some extent in the community management statement required by s 66 of the BCCMA. There was no suggestion that the applicant was misled or mistaken in fact by the form of the contract or that she was ignorant of the nature and dimensions of the unit or that it was to be conveyed to her including a car park. Accordingly, in my view, there has been no failure by the respondent to clearly identify the lot to be purchased and no breach of s 21(1)(a) of the LSA. That conclusion also supports the view I take that the contract is certain.
[57]
[37] Section 212 of the BCCMA provided at the relevant time:
[58]
"212 Cancellation for not complying with basic requirements
[59]
(1) A contract entered into by a person (the seller) with another
[60]
person (the buyer) for the sale to the buyer of a lot intended to
[61]
come into existence as a lot included in a community titles
[62]
scheme when the scheme is established or changed must
[63]
provide that settlement must not take place earlier than 14
[64]
days after the seller gives advice to the buyer that the scheme
[65]
(2) Also, when the contract is entered into, there must be a
[66]
proposed community management statement for the scheme
[67]
(a) there has been a contravention of subsection (1) or (2);
[68]
(b) the contract has not already been settled." (Emphasis added.)
[69]
[38] This contract did not contain a provision "that settlement must not take place earlier than 14 days after the seller gives advice to buyer that the scheme has been established or changed" but cl. 26.1 had a similar effect:[14]
[70]
"26.1 When a separate title for the Lot has issued and the Seller is of the opinion that all other Conditions Precedent contained in clause 3.1 will be satisfied within fourteen (14) days, the Seller may give notice to the Buyer calling for settlement. Settlement is due fourteen (14) days after the Seller gives that notice."
[71]
[39] The possible draconian consequences that attended the right to cancel the contract for the omission of the provision required by s 212 in its form at the time of this contract were recognised by the Court of Appeal in Bossichix Pty Ltd v Martinek Holdings Pty Ltd where McMurdo J said:[15]
[72]
"[21] The alternative submissions for the respondent were not persuasive. In my view s 212 does not require the employment of the very words of the section. It requires the contract to have the effect prescribed by the section. No purpose would be served by requiring the exact words to be used. The purpose of s 212 is not to inform the buyer of its legal rights. Rather the purpose is to inform the buyer that the scheme has been established and to allow a sufficient time prior to settlement for the buyer to make any necessary searches and enquiries. (It must be said that those purposes could have been just as well served by a provision which simply deemed every relevant contract to contain such a term, rather than providing a right of cancellation where the relevant term is not drafted according to the statute. In the present case, for example, there would seem to be no prospect that the buyer could have been prejudiced by the non-compliance with the statute such that it should be necessary to make the contract voidable by one side)."
[73]
[40] Parliament acted swiftly to remedy the possible problems suggested by the unsuccessful argument in that case by legislating on 22 June 2009 in the form suggested by his Honour to deem such a term to be included in such contracts and to have retrospective effect applying to legal proceedings started but not decided before the commencement of the amending legislation unless the contract had been lawfully cancelled before 5 June 2009 for failure to make provision as required by the then existing s 212(1).[16]
[74]
[41] In this case, the originating application sought a declaration that the applicant was entitled to cancel the contract by reason of non-compliance with s 212 of the BCCMA but no attempt to cancel the contract on that basis was made until after 5 June 2009 by a facsimile from the applicant's solicitors dated 12 June 2009 but received by the respondent's then solicitors on 16 June 2009.
[75]
[42] Accordingly the contract was not cancelled before 5 June 2009. Even had there been a purported cancellation before that date it would not have been effective legally because cl. 26.1 of the contract had the effect prescribed by the section.[17]
[76]
[43] Consequently, it is my view that the applicant was not entitled to terminate the contract on any of the grounds advanced and her application should be dismissed with costs.
[77]
[1] See schedule B cl. 16 of the contract at p. 37 of the exhibits to the affidavit of K J Davies filed 14 April 2009.
[78]
[2] See p. 71 of the exhibits attached to the affidavit of DE Hodgson filed 13 August 2009.
[79]
[7] See p 138 of the exhibits attached to the affidavit of KG Davies filed 14 April 2009.
[80]
[8] See G. Bugden, Queensland Community Schemes Law and Practice para 23-650 at p. 21, 601.
[81]
[10] See the useful discussion by Mackenzie J in Bossichix Pty Ltd v Martinek Holdings Pty Ltd[2008] QSC 278 at [10] - [15] and [22] and, on appeal, in Bossichix Pty Ltd v Martinek Holdings Pty Ltd[2009] QCA 154 per McMurdo J at [8] - [16].