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Since the property market boom through COVID, the number of disputes arising between Developers and buyers has skyrocketed, usually as a result of unfair terms in standard form contracts and misleading or deceptive statements made to induce clients into signing contracts.

Fortunately, there is scope to resolve such disputes via the Australian Consumer Law (ACL).

It has long been held that individuals selling their homes are not acting “in trade or commerce”. However, if a vendor is selling an investment property, such as in the case of a property developer, their conduct may be subject to the obligations under the ACL, including.

  1. Section 18 of the ACL, which prohibits a person from, in trade or commerce, engaging in conduct that is misleading or deceptive or likely to mislead or deceive.

 

  1. Section 23 of the ACL, which provides that the term of a consumer contract or small business contract is void if it is unfair and contained in a standard form contract. Section 24 sets out that a consumer contract is unfair, if:
  • it ‘would cause a significant imbalance in the parties’ rights and obligations arising under the contract,
  • it is not reasonably necessary to protect legitimate interests; and
  • it would cause detriment to a party if applied/relied on.

Importantly, a ‘consumer contract’ is defined for this purpose as a contract for a supply of goods or services or sale or grant of an interest in land to an individual whose acquisition of the goods, services or interest is wholly or predominantly for personal, domestic or household use or consumption.

If you are having issues with a developer who you believe is acting in a misleading or deceptive manner, or relying upon terms of a contract that are unfair, please give Jack Raward from our office a call on 0449 146 186 to discuss how we might be able to assist.