Answerthreeof the following questions
Question One:
Emily and David recently bought a neglected farm. No one had lived in the farmhouse for many years and there was no electricity. After looking around the farm, they became concerned that there was a problem with the electricity connection. Emily and David asked the agent about it. The agent said to them: "You just have to connect the electricity when you move in."
Emily and David still felt concerned and raised it with their conveyancer, who sought an additional special condition in the contract which said:
"The vendors confirm that electricity is connected and available to the property."
The vendor's conveyancer agreed to the inclusion of the above special condition. Emily and David proceeded to exchange contracts and six weeks later, settled their purchase.
After settlement, Emily and David contacted the electricity provider to connect the electricity. They were informed that the line, poles and transformer would all have to be upgraded before there would be any power to the farm. After speaking with a contractor, they were advised this would cost $50,000.
Advise David and Emily of their legal position.
Question Two:
You are the conveyancer acting on behalf of Sandra, who is selling her property. Sandra contracted with a real estate agent, Matthew, to sell her property.
The Agency Agreement provides that Matthew had to use his best endeavours to sell the property for between $400,000 to $450,000 in three months. Provided that he did this, then he was entitled to 3% commission on the sale price of the property.
As soon as the property was on the market, Sandra began to feel pressured by Matthew to sell the property whenever purchasers made offers. With each offer, Matthew would become more impatient with her. He would call Sandra four or five times a day and tell her that she was lucky to get offers and would emphasise issues with the property that needed repair or updating.
The property was eventually sold for $445,000 after two months, but Sandra was left feeling disappointed with the process and that the property could have been sold for a better price, if Matthew had not acted the way he did in pressuring her.
Before settlement of the sale of the property, Sandra tells you that she doesn’t want to pay Matthew the whole commission because he doesn’t deserve it, due to his behaviour. Advise Sandra.
Question Three:
Anneparked her car in a carpark outside a movie theatre. Although she saw a sign when she entered the carpark, she only read the heading ‘Conditions of Parking.’ The rest of the sign was written in very small letters andAnne could not have read the rest of the sign unless she got out of the car.
There was nothing printed on her ticket for entry to the carpark except for the time of entry.
The Conditions of Parking contained a clause that said: ‘Drivers park at their own risk and assume all responsibility for securing their vehicle and valuables.’
WhenAnne returned to her car, she found that one of her car windows was smashed and her iPod and navigator were missing. AdviseAnne about her prospects of making the carpark owners or operators responsible for the damage and loss of her personal property.
Question Four:
A purchaser brings you a contract for a property they want to buy. They tell you that they intend to knock the house down and build a luxury two-storey house. Based on the contract, you advise that the property is 500 square metres in total area and is located about 75 metres from the ocean. Due to the proximity to the ocean, there is no building permitted higher than a single-storey house. The purchaser is surprised and shows you an advertising brochure, stating ‘Build your dream home!’ The purchaser wants to know whether the real estate agents can say this, particularly when thepurchasercertainly can’t build their dream home.