The Court of Appeal in Brisbane ruled this week that lawyers acting for a Mudgeeraba unit developer must pay its losses on 14 apartment deals terminated by off-the-plan buyers in the wake of the GFC because of a contract paperwork error.

Legal blog Take the law…. has posted details of the case that concerned the solicitors’ mistaken attempts to comply with since-repealed consumer protection laws.

According to the blog site, “the 14 buyers notified in early 2009 of their intention to cancel their deals as worsening property market conditions were taking hold on the glitter strip on grounds that their ‘attention had not been directed’ to a written ‘cooling off’ statement when their copies of the contracts were returned to them”.

“Armed with advice from a third law firm that verified the consequences of the slip up the developer SDW Projects let the investors out of their contracts and then sued their former solicitors for the millions of dollars involved in the foul up.”

The finicky sales law was so much criticised for its complexity and its futility, that it was in fact repealed in October 2010.

Insisting they had done nothing wrong the two original law firms – Gold Coast Solicitors and the Clements law firm – defended the claim which prompted SDW to also sue the third law firm to be sure it had all its bases covered.
“But in December 2012, the Supreme Court ruled that the first two law firms must bear responsibility for the non-compliance, however trivial that may have been”.

Three appeal judges this week upheld that ruling.