A Canberra developer has had some success in an appeal in relation to an action brought for misleading or deceptive conduct involving the sale of a unit in the ACT, which the developer incorrectly claimed was subject to GST. The developer obtained land under a 99-year lease. It then developed properties which it allegedly marketed as being subject to GST (ie for a GST-inclusive price). However, in the interim, it had obtained a private ruling stating that the sale of units would be input taxed.

The Federal Court, at first instance, held that the sale contract was not amended, by the vendor, to reflect the change in the GST treatment, from a taxable supply to input taxed – and awarded an amount of $29,914 amount as “restitutionary relief”: Lloyd v Belconnen Lakeview Pty Ltd (No 2) [2020] FCA 698 (see related TT article).

On appeal, the Full Court held that any misleading or deceptive conduct did not cause loss or damage to the purchaser (ie over-ruling the first instance decision). The Full Court stated that it was not established that, had the purchaser been apprised of the true position (ie that the supply would be an input taxed supply rather than a taxable supply) in the period between the date of the contract and the date of settlement, she would have taken steps to renegotiate the purchase price.

(Belconnen Lakeview Pty Ltd v Lloyd [2021] FCAFC 187, Full Federal Court, Griffiths, Davies and Moshinsky JJ, 25 October 2021.) [LTN 212, 3/11/21]

[Tax Month – November 2021Previous 2021] 3.11.21

About the author