Can liability for misleading or deceptive conduct in a commercial property valuation be ‘immunised’ by a disclaimer?

Earlier this year, the NSW Court of Appeal considered an appeal in respect of a commercial property dispute that had resulted in a company having had damages of $6.9 million awarded against it.

The case of CBRE (V) Pty Ltd v City Pacific Ltd (in liq) (2022) raised a number of issues: the date of the cause of action was in dispute, raising the question as to whether the claim was statute barred; the reliance on a valuation of land; and whether the valuing company could avoid liability for misleading or deceptive conduct under Australian Consumer Law. It is the latter issue that is concentrated on here.

Briefly, City Pacific Ltd was considering the purchase of land via a subsidiary called Martha Cove Marina Pty Ltd. CBRE provided the land valuation. City Pacific made payments of $11.1 million to its subsidiary, but the acquisition fell through and funds were not recovered. City Pacific commenced proceedings against CBRE.

At first instance, City Pacific was successful in arguing that the valuation was negligently prepared and contained misleading and deceptive statements as to the land’s value that were relied upon by City Pacific. CBRE appealed, arguing that the report was not addressed to City Pacific and included a disclaimer to the effect that the valuation was ‘for the use only of the party to whom it is addressed’.

The Court did not accept this argument. Determination of misleading or deceptive conduct must be by consideration of all the circumstances. The use of a disclaimer does not change the fact that CBRE was in breach of the statutory standard.

Contact our Commercial Property Dispute Lawyers in Sydney, NSW

Szabo & Associates Solicitors are experienced in all aspects of commercial property disputes. If you need our help, please contact us on 02 9281 5088 or fill in our online contact form.