Dangers in including vendor content in sales brochures

The Issue:

What is your liability to the Purchaser if your Vendor client has given you a diagram or content you use in your marketing that turns out to be wrong?

What Happened?

An Agent was selling a water front property in Sydney. As part of the sale, they prepared a brochure for the property. In addition to content prepared by the Agent, the brochure included a survey diagram of the property provided by the Vendor. A Purchaser received the brochure and, relying on the survey diagram in the brochure, bought the property with the intention of altering the location of the pool on the property and extending. The diagram contained an error that made the Purchaser's intended plans impossible. The contract fell apart, the parties proceeded to sue each other and the Purchaser also sued the Agent for misleading and deceptive conduct.

The High Court found that the agent, in providing the brochure with the faulty diagram, did not engage in misleading or deceptive conduct because:

• The Agent, in his conduct, did nothing more than hand the brochure to the Purchaser and did not assert any belief in the accuracy of the content and he could not be taken to know the accuracy of the content.
• The Agent made it clear in the brochure and by the circumstances that he was not the source of the survey diagram and was only passing it on.
• The Agent had a clear disclaimer on the brochure and their conduct did not differ from the terms of the disclaimer

Practical Tip:

Be aware of what representation you make when handing brochures or other documents to the Purchaser and ensure that you have suitable disclaimers in place to protect you.

If you require assistance, please give us a call on 1300 205 506 or send an email to sp@sharrockpitman.com.au.

The information contained in this article is intended to be of a general nature only and should not be relied upon as legal advice. Any legal matters should be discussed specifically with one of our lawyers.

Liability limited by a scheme approved under Professional Standards Legislation.