Would-be Emerald Lakes Gold Coast buyers win court case over loss of views
A couple who bought an off-the-plan Gold Coast apartment have been able to set aside a $1,595,000 Bella Vue, Emerald Lakes purchase contract as a result of misrepresentations made by the developer’s sales representative regarding unrestricted views.
Nifsan, the developer, had lodged an application to develop the area in front of the Bella Vue apartment building with an 11-storey block that would have impeded the lake views at the time the representations were made to the buyers, Marcus Buskey and Raakel Tuominen.
The buyers had seen a newspaper advertisement offering “exclusive penthouse apartments with views from Surfers Paradise to Burleigh” within the French Quarter at Emerald Lakes.
The buyers claim they were induced to enter into the contract by a misrepresentation about the views from the eighth floor and were entitled to terminate the $1,595,000 contract entered into between the plaintiff and the defendants in February 2008.
Notice of termination was given and the buyers requested the return of the initial deposit of $1,000 and the balance deposit of $78,750.
However Nifsan commenced proceedings against the buyers for specific performance.
The buyers sought a declaration pursuant to then s87 of the Trade Practices Act 1974 (now s237, 238 of the Australian Consumer Law) that the contract was void or was set aside.
The court found that the representations were misleading, triggering then s51A of the Act (the equivalent provision is now found at s4 of the Australian Consumer Law).
Section 51A provided that representations as to future matters would be deemed to be misleading if there were no reasonable grounds for making the representation.
Salesman Guy Joris says he was not aware of a substantial application that his employer, Nifsan, had made in October 2007 to Gold Coast City Council that sought approval increasing building heights in the waterfront precinct from five storeys as shown on approved plans to a height of up to 12 storeys. Joris’s evidence – and Nifsan accepts his evidence as correct in this regard – was that Nifsan had a policy not to tell its sales staff of such matters.
But Judge Peter Applegarth did note the sales manager, Joris's superior, knew of the important application, as did its management team.
The judge noted it was improbable that Joris would not tell the buyers what he knew about the height of buildings proposed to be built and their effect on views from the apartment in Bella Vue that the buyers proposed to acquire.
The court ultimately found in favour of the buyers determining that the buyers did suffer damage as a result of the developer’s misrepresentations regarding the view.
The buyers also successfully argued that they would suffer loss if compelled to complete the contract as a result of the large differences between the then current market value of the apartment and the agreed price. In August 2010 Nifsan prepared a valuation report that gave a value of $1,000,020. The buying couple’s expert evidence was the apartment had a current market value of $820,000.
Nifsan chief executive Sean Wardrop has said the company reserves its right to appeal the court decision.
Nifsan is a privately owned property developer operating in southeast Queensland owned by the Japanese billionaire Toshiaki Ogasawara.
Since 1991 Nifsan has won some 30 state and national awards for their property developments from industry groups including the Urban Development Institute of Australia, the Housing Industry Association and the Queensland Master Builders Association.
Its European-inspired village – with buildings including Le Parisien, Maison and the nine-level Bella Vue, sit on a 201-hectare Carrara site that includes a golf course and a lake.
