Paid money based on wrong initial advise. No refund later.

Hello everyone,

Some background:
I am planning to build a house + granny flat on a 450 sqm land in NSW via CDC approval. My builder said the maximum site coverage allowed is 50%. When I talked to different builders I got conflicting opinion. Some say it is 50% others say 55%.


I called a company who provides CDC approvals and the person(his title is "Surveyor") I talked to confirmed that he would approve it based on 55%. After phone talk I emailed him all the relevant details (single story house + granny, 450sqm land, location etc.) and he confirmed me that he can get it approved based on 55%. I have email evidence of that.

I agreed to go ahead with him and paid him first instalment of his fee which was $1320.

When the report came back turned out that the allowed site coverage is only 50% hence my house design is rejected and he asked me to make amendments and bring it under 50%.

Now I am asking to refund my money. He refuses.

His argument: Since the initial advise is only an opinion and the outcome of an application can only be confirmed once the application is submitted and fee is paid. He has provided the report hence no refund.

My argument: The only thing I asked before paying him money was whether the rule is 50% site coverage or 55%. I also told him that my builder says 50%. He still confirmed it is 55% and took the money. Now after the report he says 50% and suggesting amendments. If he had told me it was 50% in beginning then I wouldn't have signed up for his expensive service. My builder was ready to do it much cheaper. Hence refund is justified.

Questions:
1. Based on above situation should I lodge a complain with fair trading?
2. If answer to above question is yes, should I ask for only the refund of fee paid or also claim land holding cost because of the delay? (roughly $1500 based on on current interest rate)

Please suggest. Thanks in advance.

 

What did your lawyer suggest? Misleading and decetive conduct has more avenues to remedy than normal commercial contract law

 

What are the terms of retainer?

 

Can the house be put through first then the gf to get around this provision in the LEP? Ie 2 cdc's?

 

I have not approached a lawyer yet. I am not sure if there is enough ground for legal proceedings or should I approach fair trading. The damage I would claim is around $2k-3k. It is not huge.

You mean the terms and conditions on form I signed before I paid money? The summary of relevant portion of terms is : "The outcome is based on assessment of application and if plan is rejected then money is not refunded."

Please note that I am not arguing the outcome of application. I know (now) that the correct rule allows only 50% site coverage.

My argument is: Initially he provided me misleading information (saying the rule is 55%) and took the money. Now when the application is rejected because of same rule he is showing me the law.
Had he told me the correct rule before taking money I wouldn't have gone ahead with him.

 

Evidence of all oral and written nature be put to him and warn him of legal action first before going any further.

 

I am not sure about that. Will explore this option. Thanks for suggestion.

I do not have evidence of oral communication but I have emails where I have sent him multiple reminders and a final reminder for warning to go to fair trading.

 

As an expert there is a reasonable assumption that he should know the rules and not accept your engagement if he knew he could not deliver on your requirements. I think you would have a reasonable case to get a refund.

It would be akin to someone asking me to find them a house for 250k 5km from the CBD with a 10% yield, and me saying sure I can do that, getting their money and then saying actually nah cant be done, I knew this from start but I am keeping your money anyway.

 

@DaveM That's exactly how I feel.

 

what would a reasonable person think when looking at these email communications? Are the communications from him confirming your instructions etc? If so, it makes your case stronger.

 

I can understand why you feel annoyed. I would be very annoyed too.

In this case you may have to settle for a formal complaint to the office of fair trading or consumer protection in your state. Legal action is likely going to cost far in excess of the amount you have lost.

 

Thanks everyone. I won in tribunal (NCAT) today and received order for full refund.

This forum rocks.

 

That's awesome! I am very happy I was wrong with my advice. Good on you for following it through.

 

Consumer Law remedies probably applied in the decison...ie misleading and deceptive. Professional obligations impose obligations beyond mere opinions or speculation. Its advice.

What was the Tribunal reasoning ?

 

Here is how it went:

1. I consulted the free "Legal Aid" in my area and after listening to my story he advised me to approach fair trading as he thought I have a case.

2. I approached fair trading but after several back and forth calls they concluded that the matter is outside of jurisdiction of fair trading and advised me to go Tribunal(NCAT).

3. I then formally lodged application with NCAT. Cost me $47.

4. On hearing day as a first step counsellor at NCAT asked us to attempt concelliation where other party agreed to pay 50% and resolve the matter before entering hearing room. I said no. We went inside hearing room. The judge before starting the formal proceeding gave us another chance and asked us to resolve matter mutually. At this stage other party agreed to pay 80%. I said no.

As formal proceedings was about to begin other party gave up and said he will pay 100%.

It may have taken more than one hearing to resolve matter had the proceeding started.

Judge issued final order to other party to pay 100%. We walked out and exchanged some friendly chit chat before saying goodbye.

First experience for me seeing a courtroom and a great learning.

 

Congratulations. Well done. It's a hearing room not a court room. They are tribunal members, some legally trained some not.

 

ditto

 

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well done, I posted before I read this.

 

Well done. $47 is a low investment and often well worth it even for principles. Many will try it on and hope you dont front - They get judgement then. And just like Judge Judy its important to go in with evidence and facts and leave the emotion outside.