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Question 1

Harmon v Victorian Mansion Realtors
Magistrate Oneton is presiding over a difficult matter in the Brisbane Magistrates Court.  Ben Harmon is suing Victorian Mansion Realtors for $140,000 in damages, for failing to disclose that several murders had been committed in the house that the Harmon family had recently purchased.  The last murder committed in the house was in 1962.  You may assume that a real estate agent’s obligation to inform a purchaser of any unnatural deaths on a property is governed by the common law.  Magistrate Oneton is faced with the following five precedents:


1.Tate v Violet Real Estate a 2003 decision of the Queensland District Court.  In this case, the District Court judge ruled that a real estate agent was under no obligation to inform purchasers of previous deaths on the property.

2.Constance Brick Homes v Larry, a 2009 decision of the High Court of Australia, on appeal from the New South Wales Court of Appeal.  Prior to being appealed to the High Court, the New South Wales Court of Appeal had unanimously held that a real estate agent has a duty to fully disclose any unnatural deaths that have occurred on a property.  Due to a conflict of interest, the High Court of Australia sat with six justices. The High Court was split 3 – 3 in its ultimate decision.

3.Moira v Racey Home Help Agency, a 2010 decision of the Victorian Court of Appeal, which followed the High Court decision of Constance Brick Homes v Larry and held that a realtor must fully disclose the details of any unnatural deaths on a property.

4.Vivien v Hayden House Trip, a 2011 decision of the Queensland Court of Appeal that expressly followed the decision reached by the High Court in Constance Brick Homes v Larry.

5.Shacath v Dark Angel Homes, a 2017 decision of the Queensland Court of Appeal.  In this case, the Court of Appeal refused to follow the precedent reached in Vivien v Hayden House Trip on the basis that it was wrongly decided.  The Court of Appeal refused to follow the decision in Moira v Racey Home Help Agency for the same reason.  The Court of Appeal referred to the High Court decision of Constance Brick Homes v Larry, but did not feel compelled to follow the decision, as no majority verdict was present in that case.

Advise Magistrate Oneton which case her Honour should follow and explain your reasoning.

Question 1: Precedents for Disclosing Deaths in Real Estate Transactions


Question 2

(a) In Question 1, Harmon v Victorian Mansion Realtors was first heard in the Brisbane Magistrates Court.  Why was the matter not heard in the Queensland Civil and Administrative Tribunal?  Provide authority to support your answer.
(b) In the event of an unsuccessful initial hearing in the Magistrates Court, which Court would Victorian Mansion Realtors appeal to?  Is there an automatic right of appeal, or would leave to appeal be required?  Provide authority to support your answer.


Question 3

The Regulated Establishment (Dress Code) Act 2017 (Qld) was passed on 29 September 2017 after a fiery debate in the Legislative Assembly.  It was assented to on 10 October 2017. When introducing the Bill for the Act, the Attorney General suggested that the legislation was a necessary response to several recent frightening occurrences at Queensland nightclubs and pubs.  She said:

Who can forget, Mr Speaker, the disgraceful episode at a Fortitude Valley nightclub where several bouncers turned up to work in their bikie uniforms and stomped on the toes of any patrons who played up? Those bouncers scared the hell out of the people at that nightclub – not to mention the foot injuries that needed hospital treatment. And what about the pub on the Gold Coast that thought it was a good idea to hold an ‘It’ themed event to celebrate the release of the new horror movie?  Several patrons of that pub were frightened out of their wits by some of the absolute clowns – and I mean that literally and metaphorically, Mr Speaker – who turned up to that event.

The Fabulous Family Restaurant is a restaurant at Southbank, in Brisbane, that specialises in hosting family groups, including babies and children.  On 21 October 2017 it held its annual Fabulous Family Fun Day, and was delighted to welcome over 100 people to the restaurant. While the restaurant does have a licence to serve alcohol with meals, most patrons do not order alcohol because of the nature of the venue.  The entry fee for the Fun Day included a glass of champagne for adults and a fruit juice for children, as well as an all you can eat buffet. 

It is a tradition of the Fun Day that the staff dress up to suit the theme of the day.  This year, the chosen theme for the dress up was ‘circus’.  Staff members dressed as ringmasters, lions, gymnasts and trapeze artists.  One of the wait staff, Michelle, dressed as a clown.  Another member of the wait staff, Larry, dressed up as a particularly convincing ‘strong man’ – he had borrowed his brother’s waistcoat with a ‘Hells Devils’ logo, which he wore without a shirt, and with lots of temporary tattoos applied to his bare chest.

Question 2: Liability for Breaching Dress Code Act in Regulated Establishments

While many of the children at the Fun Day ran around happily, one 12 year old screamed in terror upon seeing Michelle.  The child’s mother, Felicity, a lawyer, was furious that the restaurant should have been so careless as to allow Michelle to dress as a clown.  She said to the restaurant owner Cliff that, ‘Everyone in Brisbane knows about the latest clown craze  - people dressed up as clowns jumping out in front of cars, and that irresponsible movie “IT” has only made things worse.  There will be nothing pennywise about this event when you are hit with a huge fine by the appropriate authority.’  She then rang the Nightclub Regulation Authority to complain that the restaurant had breached the new Regulated Establishment (Dress Code) Act 2017 (Qld).

An inspector arrived at the Fun Day within 30 minutes and identified several potential breaches of the Act.  He was particularly interested in Michelle’s clown outfit, Larry’s waistcoat and bare chest and the fact that Felicity was wearing expensive Jimmy Choo high-heeled sandals.

The regular opening hours of the Fabulous Family Restaurant are midday to midnight, seven days a week.  The Fun Day event ran from midday to 6pm on 21 October.  ‘Hells Devils’ has been prescribed by the Minister as a ‘prohibited organisation’ as authorised by the Regulated Establishment (Dress Code) Act 2017 (Qld) s 8.

Advise Cliff as to his liability, if any, in respect of any breaches of the Regulated Establishment (Dress Code) Act 2017 (Qld) by Michelle, Larry and Felicity.  Also advise Cliff on whether he would have been granted an exemption certificate under the Act if he had applied for one on the 14th of October 2017.

Regulated Establishment (Dress Code) Act 2017

An Act to provide for a safe standard of dress in regulated establishments and for other purposes


Part 1 Preliminary


1  Short Title
This Act may be cited as the Regulated Establishment (Dress Code) Act 2017.

2    Main objects
The main objects of this Act are
(a)to ensure that patrons of nightclubs and regulated establishments dress in a safe manner.
(b)to ensure that the dress and appearance of staff at nightclubs do not threaten the safety and security of nightclub patrons. 

3  Definitions
Appropriate shoes means joggers, boots or dress shoes.
Exemption certificate means a certificate issued by the Nightclub Regulation Authority, which exempts compliance with this Act for the duration of an event.
Event means a period of time not exceeding 6 hours during the opening hours of a regulated establishment.
Prohibited organisation means an organisation prescribed under this Act as prohibited.
Reasonable person means a person over the age of eighteen.
Regulated establishment means a bar, hotel, pub, nightclub or other venue where alcohol is served. 

Part 2 Dress codes


4    Patron dress code
(1) A patron of a regulated establishment must wear appropriate shoes. 
(2) A person must not expose her chest or midriff in a regulated establishment. 
Penalty 100 penalty units

5    Staff dress code
(1) A staff member of a regulated establishment must not display the insignia of a prohibited organisation. 
(2) A staff member of a regulated establishment must not dress in a manner which is likely to cause fear to a reasonable person at the regulated establishment.
 
6  Exemptions
(1)  Upon application by the owner of a regulated establishment, the Nightclub Regulation Authority may grant an exemption certificate.
(2) The application under sub-section (1) must be received by the Nightclub Regulation Authority 7 days prior to the event.

7 Liability for breach
Where a person is in breach of any section under this part, the owner of the regulated establishment where the breach occurred is to be held liable for any penalty imposed.

8  Prohibited organisation
The Minister may prescribe a prohibited organisation for the purpose of Section 5.

Background

It is essential to keep in view that Common Law shall be the prevailing factor in deciding the fact whether a real estate agent has the obligation to inform a prospective buyer about all the unnatural deaths which have occurred on the property which is the subject matter of business between the two. The five precedents taken into consideration by the Honourable Brisbane Magistrates Court and why they were binding or not binding on the case between Ben Harmon v Victorian Mansion Realtors has been explained below.

  1. In the absence of a relevant Australian authority,Tate v Violet Real Estate is prima facie binding on the District Court in which the judgment was in favour of the real estate agent. This was because prior to the enactment of the Australia Act of 1986, the decisions of the higher authorities remained binding on lower courts.
  2. But this is not the case with the High Court of Australia, which was kept out of the purview of this enactment. Hence, the High Court was not obligated to follow the doctrine, but still a bench of 6 judges could not pass a binding judgement in the 2009 case of Constance Brick Homes v Larryas the final verdict was a tie at 3-3.
  3. In the Moira v Racey Home Help Agency, the case decided by the Victorian Court of Appeal in 2010, the Common Law again prevailed and following the precedent of the New South Wales Court of Appeal, the Victorian Court gave a judgement in favour of the purchaser.
  4. A year later, in 2011 the case of Vivien v Hayden House Tripcan be considered as merely a persuasive decision as the Queensland Court of Appeal followed the High Court judgement and ruled in favour of the purchaser. Although, being a persuasive judgement, this cannot be considered as a binding judgement under the Common Law.
  5. The 2017 decision of the Queensland Court of Appeal in the case of Shacath v Dark Angel Homeswas in favour of the purchaser and was a decision based on a superior court decision in the same hierarchy to the Queensland District Court, therefore it can be considered as binding under the Common Law principles.

From the above five judgements, it is safe to conclude that in the final analysis, the competition settles down to the decision of the High Court in the case of Constance Brick Homes v Larry and the latest judgement of 2017 of the Queensland Court of Appeal’s decision in the case of Shacath v Dark Angel Homes. Hence, the final decision, to be considered under the Common Law shall be that Judge Oneton is bound to follow the decision of the Queensland Court of Appeal in the case of Shacath v Dark Angel Homes and therefore must uphold that a real estate agent is duty-bound to disclose to the purchaser all the details about any murder which took place in the property which is under consideration.

The following limitations explain the reason. Under Section 4(a) of Magistrates Courts Act 1921 (Qld) cases pertaining to personal action, where amount claimed does not exceed the prescribed limit of $150,000 should be commenced in the Magistrates Court.

However, under Section 68(1)(a) of the District Court Act 1967 (Qld) states that the District Court have the jurisdiction to hear personal actions in which the value of damages sought is $750,000. Since, in the case under discussion, the damages sought were $140,000 and this is within the prescribed limit of the Magistrates Court.

Under Section 118 of the District Court Act 1967 (Qld), Victorian Mansion Realtors have the right to appeal to the Queensland Court of Appeal. Since the amount of claim does not exceed the jurisdictional limit of a Magistrates Court, an automatic leave is not applicable. The appellant is required to seek an appeal under Section 118(2).

  1. Cliff

It is an annual traditional festival held at FFR and this year too, on 21 October 2017, FFR held the Fabulous Family Fun Day, which was attended by some 100 people. Cliff had no intention of violating the RE (DC) Act, 2017 nor of offending any of the guests, especially the children.

Liability

The question here is about the liability of Cliff, owner of the Fabulous Family Restaurant (FFR), which is a Regulated Establishment as per Clause-3 of the Regulated Establishment (Dress Code) Act 2017 (Qld) (RE (DC) Act, 2017).

The Act was enforced with effect from 10 October 2017 and under its Clause-6(2), an establishment can apply for an Exemption Certificate (also see Clause-3) for holding an event, 7 days prior to the date of the event. Hence, Cliff could have obtained an exemption if he had applied for it on 14 October 2017.

  1. Michelle

Clause-5(2) (Staff Dress Code) states that a staff member cannot wear a dress which can cause fear, but in the note it is stated that something can cause fear if it is real. Michelle was simply dresses up as a clown and was not actually causing any fear among the guests. A child can get scared easily, but that was not Michelle’s intent. Hence, he should not be fined.

  1. Larry

Clause-5(1) states that no insignia of a prohibited organisation should be displayed in the Regulated Organisation. Hence, Larry is liable for a penalty of 500 Units as he was sporting the logo of “Hells Devils”.

  1. Felicity

 Clause-4 (Patron Dress Code) states that a patron must wear appropriate shoes and Clause-3 defines appropriate shoes as joggers, boots or dress shoes. Felicity was wearing high-heeled sandals and is liable for penalty of 100 Units.

References

Beaton-Wells, C. and Fisse, B. 2011 Australian Cartel Regulation: Law, Policy and Practice in an International Context. Cambridge University Press, Melbourne, VIC.

Burnett, R. and Bath, V. 2009 Law of International Business in Australasia. Federation Press, Annandale, NSW.

Gibson, A. and Fraser, D. 2013 Business Law 2014. Pearson Higher Education AU, Frenchs Forest, NSW.

Latimer, P. 2012 Australian Business Law 2012. CCH Australia Limited, Sydney, NSW.

Moens, G. and Jones, R. (ed) 2013 International Trade and Business Law Review, Volume 10. Routledge, Oxon.

Richard, T.A. (ed) 2014 Professional Business Law Essays. Richard TA, New York.

Schaffer, R., Agusti, F. and Dhooge, L. 2014 International Business Law and Its Environment, 9th ed. Cengage Learning, Stamford, CT.

Williams, M. (ed) 2013 The Political Economy of Competition Law in Asia. Edward Elgar Publishing, Cheltenham.

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