The Facts
Farmer sells land to mining company to build haul road
In March 2007, a farmer sold his rural property near Gunnedah in NSW to a mining company. The mining company used the land to build a haul road for its mining operations. The same lawyer acted for both the mining company and the farmer on the property sale.
A clause in the contract for sale allowed the farmer to remain in his home on the land for no more than one year from 6 March 2007.
Farmer fails to vacate land one year after sale
When the year was up, the farmer failed to vacate the property. The mining company did not attempt to remove him for a further year.
In April 2010, the mining company served a notice on the farmer to vacate the property by 31 May 2010. The farmer refused, saying that the mining company had agreed that he could live on the property indefinitely.
In September 2010, the mining company again served notice on the farmer and the farmer again refused to vacate the premises.
Mining company takes legal action to remove farmer from land
After this refusal, the mining company commenced proceedings in the Consumer, Trader and Tenancy Tribunal (now known as the NSW Civil and Administrative Tribunal or NCAT) to remove the farmer from the land.
The initial application failed on jurisdictional grounds and the matter came before the Supreme Court of NSW, where the farmer represented himself.
It was up to the court to decide whether the farmer had been granted a perpetual lease by the mining company, or whether he should be ordered to vacate the property.
Expert commentary on the court's decision
Court rules in favour of mining company, requiring farmer to vacate property
In Whitehaven Coal Mining Ltd v Tomaska [2012] NSWSC 1445, the Supreme Court of NSW ruled in favour of the mining company, Whitehaven Coal Mining Ltd.
The farmer, Mr Tomas Tomaska, was required to vacate the property.
Farmer also required to pay damages
Whitehaven also claimed damages, being rent going back to 6 March 2007. This was the date Mr Tomaska was required to vacate under the contract for sale.
However, the court pointed out that Whitehaven had willingly allowed Mr Tomaska to stay on the property until 31 May 2010 with no occupation fee.
Damages were therefore calculated at $26,000, being $200 per week from 31 May 2010 to the date of judgement.
Mr Tomaska was also ordered to pay Whitehaven’s legal costs.
Court favours mining company’s evidence over farmer’s evidence
The court noted that there was significant conflict in the evidence given on behalf of Whitehaven and by Mr Tomaska.
Unlike Mr Tomaska’s evidence, which the court found unpersuasive, Whitehaven’s evidence was seen as generally consistent and in accordance with the objective facts.
The court found it improbable that Whitehaven would have bound itself to a lease for an indeterminate, potentially lengthy period. It accepted the evidence of Whitehaven’s community liaison officer that he had never offered Mr Tomaska a perpetual lease.
The court also accepted the general principle put forward by Whitehaven:
Further, the court accepted the evidence of the lawyer who had acted on the sale. She confirmed that she had explained to Mr Tomaska the effect of the one year licence in the contract and that he had made no objection to it.
She also confirmed that she did not advise Mr Tomaska that the one year licence was merely included so that the sale did not attract GST.
Based on its assessment of the evidence, the court concluded that it was more likely than not that the agreement of the parties was that contended for by Whitehaven and contained in the contract for sale.
Written contracts usually override previous agreements
This case shows the importance of ensuring that you understand the formal written contract and that any agreements made are expressly included in it.
Most of the time, the land sale contract overrides any previous verbal or written agreements, unless expressly stated otherwise. The written contract usually constitutes the entire agreement between the parties.
It also usually contains a special condition stating that the purchaser cannot rely on any conduct, statement or representation made by the vendor, agent or other third party, other than those made within the contract.
Each party should have independent legal advice
Whitehaven and Mr Tomaska were represented by the same lawyer on the conveyance.
It is usually more appropriate for each party to have their own lawyer, so that everyone receives proper, clear and appropriate advice as to the consequences of the contract they are entering into.
Be cautious about representing yourself
Mr Tomaska represented himself in the Supreme Court.
Not only was his evidence viewed as unpersuasive, but the Supreme Court also commented that the original defence filed by him was “struck out as embarrassing”.
Mr Tomaska then filed two amended defences, to which the court said: “They are also objectionable but in the interests of the matter proceeding [Whitehaven] did not seek to strike them out…”
Mr Tomaska may still have lost this case had he been properly represented, but it is a good reminder to be cautious about representing oneself in legal matters.
As we know from the quote sometimes attributed to Abraham Lincoln, “he who serves as his own counsel has a fool for a lawyer and a jackass for a client”.