McGrath Sales had a lucky break recently when the Supreme Court ruled that it was not liable for misleadingly advertising: private off street and driveway parking.
The Court found that although the advertising was misleading and deceptive because the parking was not exclusive (being on land subject to a right of way), the purchaser had not relied upon that description when purchasing the property, and so McGrath Sales had not caused any loss to the purchaser.
The decision is Hyder v McGrath Sales Pty Ltd [2017] NSWSC 1647, a decision by Justice Parker of the Supreme Court of New South Wales on 30 November 2017.
The decision illustrates two aspects of the vexed issue of parking on a right of way:
- The liability of a real estate agent to a purchaser for misleading property descriptions;
- The right to park on land which is subject to a right of way.
The liability of a real estate agent to a purchaser for misleading property descriptions
McGrath Sales prepared the advertising copy for the property, which was at 24 Ginahgulla Road in Bellevue Hill. The website listings contained this description:
Nestled on a north facing 980sqm level parcel, this luxury family residence offers a premier indoor/outdoor lifestyle with Cranbrook School and The Scots College within strolling distance. It is impeccably presented to provide a home of style and elegance.
After descriptions of: Beautifully renovated, Flowing layout, Lush garden, Swimming pool, Marble kitchen, Four bedrooms, Three contemporary bathrooms and Pristine condition came:
* Double garage plus private off street and driveway parking
A site plan was displayed, which showed three ‘battle-axe’ lots, each having a ‘handle’ to the road. The ‘handles’ were subject to registered rights of way. They were side by side and were used as a common driveway for access by the owners of the three lots. Because the common driveway was very wide – 7.32 metres, there was room for open parking for up to 4 cars, tandem style, on the handle of the subject lot (Lot 4) without obstructing the driveway. The site plan made available to purchasers is reproduced at the end.
The purchaser gave evidence of being misled and deceived by the property description. The purchaser’s evidence included discussions with the real estate agents concerning two signs marked ‘Private Parking’ on the wall next to the open parking spaces on the driveway. It is relevant that there was very little on-street parking in Ginahgulla Road.
The agent’s evidence was that the property’s most attractive feature was its north facing aspect. ‘Private parking’ was a positive but relatively less important selling point. This was consistent with its low ranking on the website description, the description of ‘plentiful’ parking in the brochure and no mention of parking on the mail-our cards or on the signboard.
The Court concluded that the description private off street and driveway parking was misleading and deceptive and contrary to the Australian Consumer Law.
In reaching that conclusion, the Court rejected arguments put by McGrath Sales that:
- the description was an opinion – rejected because the existence of the right of way was a legal fact which was not disclosed;
- the owners of lot 4 were entitled to park on their own land – rejected because the land was subject to a right of way; and
- the description was covered by the disclaimer – rejected because the disclaimer dealt with boundaries, and not easements such as rights of way.
But the purchasers failed in their claim because they failed to show causation. That is, although parking was a positive factor, the Court found that “the real reason why Mr Hyder bought the property is because of Mrs Hyder’s emotional reaction to it. That emotional reaction would have derived from features such as its aspect and its potential as a family home, rather than the number of parking spaces.”
The Court went on to consider what loss in value it might have compensated the purchasers for, had it found causation. It set an amount of $150,000 in terms of value, plus stamp duty payable on that amount. The Court took into consideration the parking was not exclusive, even though it was private in the sense it could not be accessed by the public. The Court then reduced that amount by two-thirds because of the failure by the Hyders to take reasonable care in conducting pre-contractual enquiries and negotiations.
The right to park on land which is subject to a right of way
The easements for carriageway in this case were in the standard form set out in Schedule 4A of the Conveyancing Act, 1919 (NSW) namely:
A right to pass and repass with or without horses and other animals carts wagons carriages traction engines motor cars and other vehicles laden or unladen over and along the subject land.
This was the Court’s analysis:
“It is easy to see how the idea appears to have grown up that the area was exclusively for parking for lot 4. But the difficulty is that lot 4 has no greater right over the use of the driveway than either of the other lots. If the owners of lot 4 were entitled to appropriate one-third of the driveway area to themselves, except where a vehicle which is too wide to pass down the other two-thirds of the area needs to get past, then each of the owners of the other lots should be entitled to do the same with their “handle” strip, and that would be unworkable.
In my opinion, the effect of the various easements and cross easements over the driveway area is to give the three lot owners equivalent rights over the whole area. It is no doubt open to the lot owners to park in the “private parking” area where that does not interfere with access to the properties served by the driveway. But, in my view, the owners of lot 4 have no greater legal right to park there than any other lot owner.” (para 90, judgement)
“… they have no absolute right to park there at any and all times.” (para 125, judgement)
Conclusions
Real estate agents need to check the accuracy of descriptions of parking rights, if they are on the driveway of a property, before including them in their marketing material.
Parking by an owner on their land which is subject to a right of way is possible, but only with the consent of the other owners of land who have the benefit of the right of way.