Livingstone v Mitchell [2007] NSWSC 1477

Livingstone v Mitchell [2007] NSWSC 1477

Although the defendants admitted breach of duty in failing to make adequate enquiries and advise that the contract was voidable because no Home Building Act insurance certificate was attached, the plaintiffs did not prove that they would have rescinded. On the surrounding circumstances, including their property development experience, inspections, the Jeffs report, intended resale, and belief that the property was a bargain, the Court found they would probably have negotiated a lower price and proceeded. The value of the lost opportunity was assessed at $10,000. The defences of contributory negligence and failure to mitigate were not made out.

Jurisdiction
Australia
Judgment Date
18 December 2007
Procedural Posture
Claim for Damages by Former Clients Against Solicitors for Professional Negligence in a Conveyancing Transaction / Trial Judgment in the Supreme Court of New South Wales, Common Law Division, Professional Negligence List
Outcome
Judgment in favour of the plaintiffs for $10,000 and interest from 9 November 2001; costs reserved.
Legal Topics
['solicitor Negligence in Conveyancing' 'owner Builder Home Building Insurance' 'right to Rescind Contract for Sale of Land' 'causation and Loss of Opportunity' 'measure of Damages' 'contributory Negligence' 'mitigation of Loss' 'admissibility of Evidence About Hypothetical Conduct']
['legal Profession' 'torts' 'negligence' 'evidence' 'conveyancing'] ['solicitor Negligence in Conveyancing' 'owner Builder Home Building Insurance' 'right to Rescind Contract for Sale of Land' 'causation and Loss of Opportunity' 'measure of Damages' 'contributory Negligence' 'mitigation of Loss' 'admissibility of Evidence About Hypothetical Conduct']

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Procedural Posture

Claim for Damages by Former Clients Against Solicitors for Professional Negligence in a Conveyancing Transaction / Trial Judgment in the Supreme Court of New South Wales, Common Law Division, Professional Negligence List

Legal Issues

  1. 1 ['Whether the plaintiffs would have rescinded the contract or otherwise acted differently if properly advised that no Home Building Act insurance certificate was attached and that the contract was voidable.' 'What measure of damages applied to admitted solicitor negligence in the conveyancing transaction.' 'Whether damages should be assessed by cost of rectifying defects, diminution in value, the value of a lost insurance claim, or the amount by which the purchase price could have been reduced in negotiation.' 'Whether statements by the plaintiffs about what they would have done if properly advised were inadmissible under Civil Liability Act 2002, s 5D(3)(b).' 'Whether the plaintiffs were contributorily negligent by failing to read the pre-purchase report properly or make further enquiries.' 'Whether the plaintiffs failed to mitigate by not selling the property or suing the vendors.']

Ratio Decidendi

Although the defendants admitted breach of duty in failing to make adequate enquiries and advise that the contract was voidable because no Home Building Act insurance certificate was attached, the plaintiffs did not prove that they would have rescinded. On the surrounding circumstances, including their property development experience, inspections, the Jeffs report, intended resale, and belief that the property was a bargain, the Court found they would probably have negotiated a lower price and proceeded. The value of the lost opportunity was assessed at $10,000. The defences of contributory negligence and failure to mitigate were not made out.

Court Disposition

Judgment in favour of the plaintiffs for $10,000 and interest from 9 November 2001; costs reserved.

Orders

  • ['Judgment in favour of the plaintiffs for $10,000 and interest from 9 November 2001.' 'The Court will hear the parties on costs.']