Australia: No relief for buyer of property for seller's misleading and deceptive conduct - 24 August 2015

Last Updated: 31 August 2015
Article by Anthony Pitt and Borcsa Vass

The Australian Consumer Law provides protection for certain buyers when sellers engage in misleading and deceptive conduct. However, such protection often does not extend to buyers of residential property.

Special Counsel, Anthony Pitt and Solicitor, Borcsa Vass discuss a recent New South Wales Court of Appeal decision which demonstrates the significance of buyers of residential property not having the protection of the Australian Consumer Law, and where they could turn to instead.

Williams v Pisano [2015] NSWCA 117

In Williams v Pisano, Mr and Ms Pisano (Buyers) purchased a property (Property) from Mr Williams and his wife, Ms Dandris (Sellers). The Property was sold for $3.35 million.

The Sellers originally purchased the Property in 2003 and lived in it until 2010. Originally, it was a modest three-bedroom house. In 2010, they moved out to allow renovations to be carried out during 2010 and 2011. The renovations resulted in the Property being converted into a double-storey five-bedroom house with a swimming pool and a rooftop terrace with views of Sydney Harbour. The renovations were carried out largely under the supervision of Ms Dandris, without detailed architectural plans or supervision.

In late 2011, the Sellers retained a real estate agent (Agent) to market the Property for sale. The online advertisement contained statements about the quality and standard of the renovations carried out on the Property.

The Buyers saw the advertisement and on 19 December 2011, inspected the Property. At the inspection, the Buyers were given a brochure about the Property which also contained statements about the quality and standard of the renovations. During the inspection, the Agent also made oral statements about the renovations. Around this time, Ms Dandris handed Mr Pisano a business card describing her as an "interior designer". The Buyers agreed to purchase the Property the following day.

After settlement, the Buyers moved into the Property. Problems however soon emerged, and on 16 April 2012, there was significant water penetration into the Property following rainy weather.

The Buyers sued the Sellers claiming a breach of section 18(1) of the Australian Consumer Law, which provides that:

"A person must not, in trade or commerce, engage in conduct that is misleading or deceptive or is likely to mislead or deceive." (our emphasis)

The issues at trial

The Sellers accepted that the representations about the quality and standard of the renovations were misleading or deceptive. The Sellers however argued that the conduct was not in "trade or commerce" and this meant that the Buyers were not entitled to the protection of section 18 of the Australian Consumer Law.

At first instance, the Supreme Court of New South Wales disagreed and found that the Sellers were liable under section 18 of the Australian Consumer Law.

The Sellers appealed. The Court of Appeal agreed with the Sellers, and found that the conduct was not in "trade or commerce" and therefore the Buyers could not succeed under section 18 of the Australian Consumer Law.

Wait, aren't all sales in "trade or commerce"?

This was an argument put by the Buyers at one stage of the appeal.1 The Court of Appeal said no. The Court explained:

"In ordinary circumstances, a person who sells his home, whether by private treaty or by auction and whether he conducts the negotiations personally or through a real estate agent, would not be said to be undertaking those activities in the course of a trade or business or in a business context. Whether or not an estate agent is used and whether or not that agent advertises the house, by preparing brochures or other advertisements, and whether or not the agent sells by auction or merely negotiates by private treaty, the sale will normally remain a sale by the vendor of his house and not an act done in a business context."

In the context of the Australian Consumer Law, "trade or commerce" requires the conduct to be in a commercial setting as opposed to a private setting, such as private sales between people who are not ordinarily in the business of selling that particular thing. One must consider the character of the parties involved, the motivation for the transaction and the relevant person's role in the transaction in order to determine this question.

Sales of residential properties are often between a private person who has resided in the property for a length of time and a private buyer who then intends to reside in it for a length of time. Neither the buyer nor the seller can be said to be entering into the sale in furtherance of a commercial purpose or business. As such, these types of sales are generally considered not to be in "trade or commerce".

The position would be different, however, if a developer (who is in the business of developing and selling properties) is selling a new property as part of a development. The fact that the sale is in furtherance of the developer's business makes that type of sale transaction in "trade or commerce".

This Alert concerns the position with respect to the Australian Consumer Law, but other remedies may well be available under the common law.


1 Williams v Pisano [2015] NSWCA 117 at [35].

© HopgoodGanim Lawyers

Award-winning law firm HopgoodGanim offers commercially-focused advice, coupled with reliable and responsive service, to clients throughout Australia and across international borders.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Borcsa Vass
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at and we will use commercially reasonable efforts to determine and correct the problem promptly.