Off The Plan Sales - The Importance Of Getting It In Writing

Xue v Karimbla Properties (No.45) Pty Ltd [2023] NSWSC 552 is another recent example of a misleading and deceptive claim in the context of an off the plan apartment sale contract.

The case demonstrates yet again the importance for developers of keeping written records of discussions with buyers as to their standard processes and procedures. Whilst the developer was successful in defending the claim, both parties relied heavily on oral evidence and the case ultimately turned on the credibility of the witnesses. 


The buyer alleged that the seller (part of the Meriton Group) (Meriton) had, through its selling agent, engaged in misleading and deceptive conduct in contravention of the Australian Consumer Law.

The buyer alleged that it had entered into an off the plan contract to purchase an apartment from Meriton based on oral representations that vendor finance at “market interest rates” would be available to the buyer. This was despite the fact that the parties had struck out the vendor finance option within the sale contract.

Shortly before settlement, the buyer made inquiries with Meriton regarding vendor finance options and was offered a vendor finance at a 6% interest rate.  The buyer rejected the offer on the basis that this was above the market rate.  The contract was ultimately terminated by Meriton when the buyer failed to settle.  

The selling agent gave evidence that:

  • at the time the selling agent met with the buyer and prior to the contract date, Meriton had provided the selling agent with a price list which outlined the vendor financing options and relevant interest rates;
  • the list indicated that, if the buyer had agreed to obtain vendor finance prior to entering into the contract, vendor finance would be available at an interest rate of 6% for a two year interest only loan;
  • the selling agent informed the buyer that, if the buyer sought vendor finance closer to settlement, a higher “rescue” interest rate would apply; and
  • the buyer made the decision to sign the contract without seeking vendor finance as the buyer believed the 6% rate was too high and he would be able to procure alternative funding from a bank at a lower rate.


Justice Henry ultimately accepted the selling agent’s account of events and found that the selling agent did not make any representation that vendor finance at a market interest rate would be available to the buyer at any time.  

Faced with two very different account of events and in the absence of contemporaneous file notes, Justice Henry came to this conclusion on the following basis:

  • Her Honour favoured the evidence provided by the selling agent who she viewed as a credible witness, having provided accurate and consistent evidence supported by the vendor finance price list and the vendor finance interest rates listed on Meriton’s website at the time the alleged representations were made; and
  • in contrast, Her Honour had concerns about the reliability and credibility of the buyer.  The buyer was not unsophisticated and was experienced in arranging loans. Justin Henry found that, given the buyer’s experience, there could be no miscommunication as to the availability of vendor finance at market rate.  The buyer would have been aware that Meriton and the selling agent would require information about the buyer’s financial position before agreeing to the terms of finance (none of which had been provided at the time the alleged representation had been made).


This case highlights the importance of keeping contemporaneous file notes to record meetings with buyers and any representations made.  In the absence of written records, the court will largely need to rely on the credibility of the witnesses. This is particularly important for off the plan sales where disputes often arise at project completion which occurs many years after the sale contract has been negotiated.

Developers should also utilise sales manuals which instruct the selling agent on how to respond to specific queries.  This serves two purposes:

  • it assists in ensuring accurate information is relayed by selling agents to prospective buyers; and
  • the sales manual may be useful evidence of what the selling agency was likely to have represented to the buyer.

Any information on the developer and selling agent’s websites and other product material should also be regularly monitored for consistency.

*Acknowledgement: Andrew Freeman made a significant contribution in the preparation of this article. 

Disclaimer – the information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.