False advertising claim?

We have just purchased 17 acres of land in the North of Melbourne.

It has 2 zonings with 1 zoning being Low Density Residential.

The land was advertised as "approx 3 acres of Low Density Residential" and "ALL SERVICES AVAILABLE".

I did quite alot of due diligence but as it now turns out, not quite enough.

After having the block surveyed it turns out there is 7742m2 of LDR zoned land (so less than 2 acres) and all services are at the front of the block except for the sewerage. The sewer line ended 62 metres away.

Do we have any chance of sueing the agent for false advertising? He has been useless from day 1 and his response when i quesitoned him on the above was "thats what the vendors told me so i went with that". When I asked him why he doesnt do any of his own research to confirm what his vendors told him he didnt reply.

 

yes

 

While Terry is correct, there's also lots and lots of hurdles in being substantially successful in such a claim.

There's also a chance it might be time sensitive, so I would be getting legal advice asap if you're seriously considering this too.

 

Not a legal opinion however refer to the agent's advertising blurb - usually has something excluding liability for information provided by the owner & the buyer has to rely on their own investigations.

 

Yes it is possible to sue, but there a crap load of issues to consider - the likelihood of success being one and the consequences of losing, limitations period, consequences of losing etc.

 

I think the argument could be run that the service is available, (but not connected). Can appreciate your frustration at having the extra, unexpected cost though.

 

thank you all for your feedback, will consider it.

 

thats what i thought too! they could argue that technically it is available 20km away if they wanted to.

 

The contact generally will govern what the vendor offer is and includes. Adverts, boards, signs, verbals are not part of the offer. Caveat emptor. The contract may have been a plain and simple offer of land and shown the connections on the site plan (and no sewer). Does consumer law even apply to such a purchase ? ie misleading & deceptive conduct ? Maybe. The rest may be subject to council approvals (STCA)

Maybe worth going back to the legal advice you got prior to signing the contract. You did do that ? If not its time to revisit this and any remedies.

 

The couple who own the land have separated and the female party had made sure it was a very ironclad favourable contract for her/them.
One point even mentioned us not being able to sue them.

BUT, my issue is with the agent, not the vendors. He took what they told him as gospel and advertised it as such, I feel he is the one in the wrong.

but then im not a lawyer, just a purchasr annoyed at a real estate agent (my guess is not the first ever)

 

look at Australian Consumer Law

 

I would speculate they may have known the problems and were happy the agent wasnt diligent enough to check. I think the vendor is the problem but the agent is probably the best and easiest target. Have you quantified the loss (the value of the stuff advertised that you didnt get)?

 

This would be even harder to make out a claim against the agent separate from the vendors.

I'm starting to think you're just grasping at straws now.

 

Of course the vendor offered a contract favourable to them. Why wouldn’t they?

Did you have your solicitor check the contract before you signed it? That would have been the time to insert clauses favourable to you.

 

I don't think the REA is responsible for checking everything that the owner says. Whilst they have a duty to not lie or misrepresent they are relying on the data often from the Owners. My REA has me sign a Disclosure Statement outlining what I need to declare and if I don't know the answer then it's ticked as unsure. This information is available to any prospective owners and the onus is on the seller to know the answer or declare they don't know the answer then it's clear the buyer needs to make more enquiries to relevant authority etc

In your case I personally think you should have done more due diligence. The REA is not a developer, the owners are probably not developers either and if you are relying on that information to do your feasibility to determine the purchase then unfortunately the onus is on you to be sure of your facts.

I know hindsight is very clear and in some cases you will never know what you don't know and Title Insurance might help.

In this instance if you haven't settled yet I would be concentrating on negotiating a discount rather than seeing if you can sue someone. I have a property where it turned out after contracts were signed and before settlement we found it had a road widening easement on it and the block was then going to lose 120sqm. My lawyer handled it and we ended up negotiating a discount for the land that couldn't be used.

 

Land is really never "ready" for any development or use until YOU have a legal basis to confirm it. Residential premises are a slight exception but even then dont assume. This is why lawyers do title searches, check for impacting devs and permitted uses. What looks like a house could be zoned as a shop. A P&B check will confirm if its structurally sound. Solicitor will check its approved.

The existing owner is just selling land. The buyer is seeking to buy opportunity and they need to make all the enquires to determine what is approved, pending approval, required for approval and their costs. Thats why they are called a developer. They are taking on all the problems, costs and risks. Do it well they make money. Done badly they will lose money.

I wouldnt dream of buying dev land without a load of conditions to the contract and legal advice to support it. eg How are you dealing with the GST ?

 

Thats not his job.....thats your job.

 

This is a typical disclaimer:

"*We do not guarantee or give any warranty as to the accuracy of information and/or statements provided. Interested parties must rely on their own inquiries".

 

Caveat Emptor?