The judge said the agent did not engage in conduct which deprived the owner to take legal advice before the agreement was agreed and exchanged. They added that the matter the owner said caused the option agreement to be “unfair and onerous” was apparent from reading the draft agreement and could have been the subject of advice from their licensed conveyancer.
For details of the decision in full, please visit here.
What happened at the original court case?
The vendor, who filed the original claim, had entered into a put and call option deed with the purchaser, who was a property developer and the client of the buyers’ agent.
The sale price of the house on the North Shore of Sydney was agreed at $2.2 million and an agreement was reached that made the funds payable up to 19.5 months after the date of exchange. But after a neighbour’s property sold for $3.430 million less than a week after signing the deed, the vendor alleged the property was worth far in excess of the agreed $2.2 million.
The vendor also claimed they were misled about the value of their property, saying they hadn’t been given enough time to obtain legal advice and therefore the sale was unjust, unfair and void.
The judge found that the buyers’ agent hadn’t contravened the Australian Consumer Law, nor were his actions unconscionable. However, it was found that the vendor had relied on the buyers’ agent when determining the value of his home.
The judge said that while the vendor was naive and didn’t know his property was worth well over $2.2 million, both the buyers’ agent and developer had pressured the vendor causing him to sign the put and call option deed. The judge also held that the property developer’s lawyers should have given the vendor a cooling off period in the put and call option deed.
The judge ruled that the deed was unjust, unfair and void. As a result, both the buyers’ agent and property developer were ordered to pay the vendor’s costs.
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