Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd
[2006] QDC 158
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- Unreported Judgment
- Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd[2006] QDC 158
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Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd[2006] QDC 158
Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd[2006] QDC 158
DISTRICT COURT OF QUEENSLAND
CITATION: | Glenlyon Developments Pty Ltd v Norfolk Estates Pty Ltd [2006] QDC 158 |
PARTIES: | GLENLYON DEVELOPMENTS PTY LTD ACN 102 950 710 Applicant Plaintiff V NORFOLK ESTATES PTY LTD ACN 010 355 138 Respondent Defendant |
FILE NO/S: | BD 954 of 2005 |
DIVISION: | Civil |
PROCEEDING: | Application |
ORIGINATING COURT: | District Court of Queensland, Brisbane |
DELIVERED ON: | 8 June 2006 |
DELIVERED AT: | Brisbane |
HEARING DATE: | 20 April 2006 |
JUDGE: | Alan Wilson SC, DCJ |
ORDER: | Application dismissed |
CATCHWORDS: | CONTRACT – TERMINATION – STATUTE GIVING RIGHT TO AVOID CONTRACT – whether plaintiff, a company, entitled to avoid contract under Property Agents and Motor Dealers Act 2000 – whether warning statement signed and dated by directors in compliance with that Act Property Agents and Motor Dealers Act 2000, ss 366, 367 Corporations Act 2001, ss 127, 128, 129 Deputy C’ssner of Taxation v Salcedo [2005] QCA 227 MNM Developments v William Alan Gerrard [2005] QCA 230 M P Management (Aust) P/L v Churven & Anor [2002] QSC 320 MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 195 CLR 636 Williams Deceased (1984) 36 SASR 423 |
COUNSEL: | Ms S J Armitage for Applicant Plaintiff Mr J S Couper QC for Respondent Defendant |
SOLICITORS: | Sunnybank Solicitors for Applicant Quinn & Scattini for Respondent |
- [1]This application for summary judgment is brought in proceedings which arise out of a contract for the sale of a property at Gladstone dated 31 March 2003. It hinges upon the construction of legislation designed to ‘…ensure a form of consumer protection for the purchasers of residential property’[1]: the Property Agents and Motor Dealers Act 2000 which, in short, requires that a contract of this kind must have attached, as its first or top sheet, a statement containing specified warnings to the purchaser which, to be effective, must be signed and dated by the purchaser before the contract is signed; and, provides that non-compliance may entitle the purchaser to terminate.
- [2]The nature of the application is such as to require the court to determine whether the respondent has established some real prospect of succeeding at a trial[2]. Here, the exercise involves determining a discrete point which, if resolved in the applicant’s favour, would extinguish the primary facet of the respondent’s defence.
- [3]The plaintiff purchaser, a company, could only execute a document without its common seal if both directors, Mr Hill and Mr Street, signed[3]. It is not in issue that the defendant vendor’s agent, a Mr Spearing, delivered a warning statement (in the required form, and position vis a vis the contract) and the draft contract first to Mr Street and, materially, he signed but did not date the statement, and signed the contract. Later, the Defendant signed the contract. Later still, Mr Hill signed and dated the warning statement, and signed the contract.
- [4]The applicant’s case is dependent upon the meaning and effect of s 366(4)(a), which provides:
A statement purporting to be a warning statement is of no effect unless –
(a) before the contract is signed by the buyer, the statement is signed and dated by the buyer…
- [5]Ms Armitage, for the applicant, advances two propositions: first, that in the circumstances arising here compliance is only achieved if the statement is signed and dated by both directors before they sign the contract; and secondly, that there is non-compliance here because Mr Street did not date the warning statement. Mr Couper QC, for the respondent, contends that both submissions go beyond the intent or requirements of the Act.
- [6]It is common ground that, putting the provisions of the Act to one side, the contract did not bind the plaintiff company until the document was signed in a manner consonant with its own rules, and the Corporations Act – ie, by both directors. It follows, Mr Couper says, that the contract was not ‘signed by the buyer’ until the second director, Mr Hill, did so and until that time the parties were still in the pre-contractual stage envisaged by the first phrase in the sub-section. As to the second limb, he submits that the provision does not insist upon dating by every signatory who signs for a corporation, and the insertion of a date by Mr Hill is sufficient compliance.
- [7]The drafting of this part of the Act has been criticised[4] but, the cases show, it is not to be construed broadly or with excessive liberality. In M P Management (Aust) P/L v Churven & Anor [2002] QSC 320 Muir J was required to consider the meaning and effect of the word ‘attached’ in s 366(1) and said, albeit of an earlier form of ss 366 and 367:
[21] In its more restrictive sense and, I rather think, every day sense ‘attached’ connotes some form of joinder, fastening or affixation. There is nothing in the context of s 366 or s 367 which would tend to indicate that the word should be construed broadly, quite the contrary. The aim of the section appears to be to give prominence to the warning statement by ensuring that not only is it inseparable from the contract proper but that it is the first document seen by a prospective purchaser when perusing the contract.
- [8]This approach was endorsed, with reference to the current form of the provisions applying here, in MNM Developments v Gerrard (supra); de Jersey CJ said, at p 7:
[16] The context of the requirement set up by s 366 tells against a liberal interpretation of that requirement. Chapter 11 of the Act, in which s 366 occurs, contains a detailed set of technical requirements plainly directed to ensuring a form of consumer protection for purchasers of residential property. One of the objects of the Act, stated in its preamble, is ‘to protect consumers against particular undesirable practices’. That protection extends, in cases like these, to giving a purchaser a right to terminate even for quite technical contraventions, and whether or not the purchaser has suffered any material disadvantage. See, for example, s 366(4)(a), s 366(4)(b) (including an example) and s 367(2).
[17] In Sidbent Pty Ltd v Reinisch [2003] QSC 203, White J suggested that because a failure to attach attracts criminal sanctions (s 366(2)), a broad interpretation of what amounts to attachment might be favoured. But if the natural construction of this remedial provision is clear, then that should be adopted. While a particular statutory construction may sometimes produce inconvenience, that does not justify departure from that construction if it is clear (cf. Horinack v Suncorp Metway Insurance Ltd (2001) 2 Qd R 266, 267, 269).
- [9]This careful approach to construction is, however, carried beyond the reasonable meaning and effect of the sub-section by the applicant’s first submission. As Williams JA pointed out in the MNM Developments case, the apparent intention of the legislature was to ensure the warning statement was brought to the attention of the purchaser prior to the execution of the contract – i.e., before the point at which the contract comes into existence through due execution by each contracting party[5]. That did not occur, here, until the plaintiff company completed lawful execution by Mr Hill’s act of signing. Nothing in the sub-section suggests it is intended to over-ride provisions governing the way a company ‘signs’ a contract to complete execution and make it lawfully binding.
- [10]The absence of any apparent statutory intention of that kind puts this case outside some authorities relied upon by the applicant for the proposition that, when questions of proper execution arise, a statute may prevail over the constitution of a company[6], or other rules or directions about modes of execution.
- [11]The respondent raises similar assertions in respect of the applicant’s contention that, in any event, there has been non-compliance because the warning statement was only dated once, by Mr Hill. Proper compliance, the applicant says, can only be achieved if both directors date at the time of their signing. The argument comes close to suggesting that because s 127 of the Corporations Act requires two signatures, two dates are also necessary; but the section, plainly, does not go so far.
- [12]Nor can it be said the Property Agents and Motor Dealers Act 2000 necessarily does so; and, there is no sensible purpose of the Act which would be served by that construction. The position of a corporate purchaser is not analogous to that of more than one separate purchaser; this is not two buyers, but one. The apparent purpose of requiring a date to be inserted is to aid any subsequent determination whether the warning statement was signed before the contract. That purpose is not advanced by requiring the date to appear twice, when a corporation is signing.
- [13]As Mr Couper pointed out, there are other ways a company might lawfully sign – in particular, under seal with two director’s signatures; but, on the applicant’s submission, two dates (one for each director) would still be necessary, despite the sealing. It strains the obvious purposes of the provisions to think it compels compliance in that way.
- [14]It is certainly within the ordinary power of one director, in these circumstances, to insert a date in the course of performing normal directorial duties[7]. Notwithstanding the close reading of the provisions urged by higher courts, and their acknowledgment that the section proscribes quite technical breaches which might, otherwise, be overlooked in the context of contract law, I am not persuaded it was intended to reach the circumstances arising here
- [15]The application for summary judgment will be refused. I will hear further submissions.
Footnotes
[1] MNM Developments v William Alan Gerrard [2005] QCA 230 per de Jersey CJ at [16]
[2] Deputy C’ssner of Taxation v Salcedo [2005] QCA 227, per Williams JA at [17]
[3] Corporations Act 2001, s 127(1)
[4] MNM Developments v Gerrard, supra, per Williams JA at [27]-[29] and McMurdo J at [52]-[56]
[5] MNM Developments v Gerrard, supra, at paras [28] and [29]
[6] MYT Engineering Pty Ltd v Mulcon Pty Ltd (1999) 195 CLR 636; Williams Deceased (1984) 36 SASR 423
[7] Corporations Act, ss 128, 129