In the case of OPR WA Pty Ltd v Marron1 the Supreme Court of Western Australia:
OPR WA Pty Ltd (Seller) and Wayn Marron (Buyer) are parties to a contract for the sale and purchase of property in Bassendean, Western Australia, which incorporated the General Conditions (Sale Contract).
Under the Sale Contract:
Landgate issued the certificate of title for the property on 5 April 2016. The settlement date was 3 May 2016. The Buyer failed to complete settlement by 3 May 2016.
By letter dated 5 May 2016 from the Buyer to the Seller, the Buyer repudiated the Sale Contract.
On 6 May 2016 the Seller served a notice of default on the Buyer requiring the Buyer pay to the Seller the balance purchase price within 10 business days of service of the default notice. The Buyer failed to do so by the due date or at all.
On 27 May 2016 the Seller issued a notice of termination of the Sale Contract on the Buyer, relying on the Buyer’s failure to comply with the default notice and the Buyer’s repudiation.
The Seller commenced court proceedings against the Buyer claiming damages, interests and costs. In defence, the Buyer claimed (among other things) that:
Part 2 – 3 of the ACL is a statutory exception to the freedom of contract approach of the common law. However, insofar as this case is concerned, it only applies to standard form ‘consumer contracts’.
A consumer contract is a contract for a supply of goods or services or a sale or grant of interest in land to an individual whose acquisition of the goods, services or interest is wholly or predominately for personal, domestic or household use or consumption.
The Buyer failed to file any evidence to disclose the Buyer’s purpose of acquiring the property and as a result could not prove to the Court that the acquisition of the property was wholly or predominately for personal, domestic or household use. The Court said that it was not possible to conclude that the Sale Contract was a consumer contract ‘for personal use (and not for investment or other purposes)’.
The Court also determined that clause 24.6(d) of the General Conditions was not ‘unfair’ under the ACL. A consumer contract is ‘unfair’ if (among other things) it would cause a significant imbalance in the parties’ eight and obligations arising under the contract. The Court took into account the extent to which the clause 24.6(d) of the General Conditions was transparent and the Sale Contract as a whole in making its decision.
The Court said that clause 24.6(d) of the General Conditions is ‘transparent, in that is it expressed in reasonably plain language, legible, presented clearly and readily available to the party affected by it’. In particular, the Sale Contract clearly stipulated that:
The implications of this decision include: