{"id":222931,"date":"2022-04-07T11:16:33","date_gmt":"2022-04-07T01:16:33","guid":{"rendered":"https:\/\/slflawyers.com.au\/?p=222931"},"modified":"2022-04-07T11:16:33","modified_gmt":"2022-04-07T01:16:33","slug":"a-cautionary-tale-for-developers-selling-off-the-plan-apartments","status":"publish","type":"post","link":"https:\/\/slflawyers.com.au\/zh\/news\/a-cautionary-tale-for-developers-selling-off-the-plan-apartments\/","title":{"rendered":"A cautionary tale for developers selling off-the-plan apartments"},"content":{"rendered":"
\u5728 Burger & Ors v Longboat Holdings Group2 Pty Ltd <\/em>[2021] VSC 469, two young couples entered into off-the-plan contracts of sale in respect of a two-bedroom (95sqm) apartment in an inner-city Melbourne suburb.\u00a0 Almost three years later when the development was completed, the purchasers discovered that the design and structure of the apartments had been changed multiple times by the developer without them being notified.\u00a0 The changes made by the developer to the apartments included a reduction in the size of the apartments, in particular, to the master bedroom, reducing the apartments\u2019 overall attractiveness and utility of that space.<\/p>\n SLF Lawyers acted for the purchasers who sought to rescind their contracts on the basis that an amendment to the plan of subdivision had occurred which would materially affect the property.\u00a0 The developer rejected the basis of the purchases\u2019 rescission notices and argued that the contracts remained on foot and settlement was required to take place.<\/p>\n The purchasers commenced proceedings against the developer by originating motion on 19 April 2021 and asked the Court to determine whether \u2018the amendment to the plan of subdivision materially affected the lot to which the contract relates entitling the plaintiffs to rescind the contract pursuant to section 9AC(2) of the Sale of Land Act 1962\u2019<\/em><\/p>\n At the heart of these proceedings was whether the changes made by the developer to the\u00a0 apartments were \u2018material changes\u2019.\u00a0 If the answer to that question was \u2018yes\u2019, the purchasers were entitled to rescind their contracts under s 9AC(2) of the Sale of Land Act 1962 <\/em>(SLA<\/strong>).<\/p>\n The relevant changes to the apartments were:<\/p>\n Associate Justice Matthews found that, some of the changes, individually and in combination, materially affected the purchasers\u2019 lots.\u00a0 Accordingly, her Honour found that purchasers were entitled to declarations that they lawfully rescinded their respective contracts.<\/p>\n A particularly noteworthy comment from Her Honour contained in her written judgment was made in relation to the evidence required in support of an application of this nature.<\/p>\n Her Honour;<\/p>\n Some other key take always from the decision:<\/p>\n SLF Lawyers are very well placed to assist with advising both purchasers and developers in respect of changes made to plans of subdivisions and off-the-plan contracts of sale.<\/p>\n SLF Lawyers are grateful and thank Jamie Grant of counsel for his involvement in both matters in the lead up to and the running of the trial on behalf of our clients.<\/p>\n\n
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