Business Law Facts Assignment
- Country :
Australia
Practice exam problem question
RHT Pty Ltd is the registered proprietor of Lot 5 in DP5746, a large block of land in Hornsby on Sydney’s north shore. The land is a short walk from the train station, and the local council rezones the land for medium density housing and mixed-use development, with the Local Environmental Plan (LEP) permitting residential and commercial use. RHT decides to build 6 townhouses on the land, and would like to increase sales prices by marketing the development as being ‘green’. RHT’s lawyer drafts the following s88B instrument, which is attached to the new deposited plan subdividing former Lot 5 into new Lots 1-6 in DP75267.
The contracts of sale for all lots include clauses 32-34:
32. The purchaser will install on their lot a minimum of five (5) solar panels having a minimum output of 2.4kW within one year of registration of a transfer from RHT Pty Ltd.
33. The purchaser will not allow anything to remain on their lot that interferes in any way with the solar access of solar panels installed on a building in any other lot in DP75267.
34. The purchaser will not engage in any retail, commercial, industrial or tourist purpose on their lot.
RHT Pty Ltd conducts a successful marketing campaign and all lots are sold by May 2013. The purchasers of Lots 1, 2, 3 and 6 each immediately install 8 x 2.4 kW solar panels on their respective roofs. The purchaser of Lot 4, Cally Cat, and of Lot 5, Will Wan, do not install solar panels.
Will Wan sells his lot to Debra Doolan in September 2014 and Debra registers the transfer. Debra intends to run a family day care centre from Lot 5, so she places a sign on the front fence advertising her services. Debra plants a fast-growing gum tree in the backyard to provide shade for the children when they play in the yard.
The owner of lot 3, Betty Ball, and the owner of Lot 1, Felix Friend, are frustrated by the way some of their new neighbours are behaving. They are annoyed that
- Lot 4 and Lot 5 have not installed solar panels,
- that Debra is running a noisy family day care centre and
- that Debra’s gum tree is shading their solar panels and compromising their function.
They decide to ring RHT Pty Ltd to complain. Concerned about their reputation as a builder, RHT promises to investigate.
Cally Cat purchased Lot 4 by borrowing $500,000 of the $700,000 purchase price from her brother Samir Sands. Cally gave Samir a mortgage over the land as security for the loan and Samir registered the mortgage. Unfortunately, Cally loses her job and cannot meet the mortgage repayments. Samir says to Cally, “I am really sorry, but I need those repayments. If you cannot meet them, I am going to have to sell the house.” Samir sends Cally a valid notice under s57 of the Real Property Act 1900 (NSW), waits the requisite period, and then advertises the house in the local paper and on Domain.com for four consecutive weeks.
On the day of the auction, ten people register to bid. Samir tells the auctioneer that the reserve price is $550,000. The property is sold to Giles Game for $600,000. Giles signs a contract with Samir and they agree on a settlement date in late July 2017.
Cally is extremely distressed by the result.
- Advise Cally of her rights.
- Can anything be done about
- the failure of Lot 4 and Lot 5 to install solar panels,
- the shade being cast by the large gum tree, or
- Debra’s family day care centre?
