Lower than expected service leads to compensation

Posted on June 13th, 2018

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Lower than expected service leads to compensationThe Applicants contracted the Respondents to arrange their wedding reception at a venue overlooking Sydney Harbour. At 4 PM on the big day a pipe burst causing a flood.

The Respondents did not own the venue and did not cause the leak. The Respondents notified the building Manager as soon as they became aware of the leak.  The reception was briefly delayed, tablecloths were placed on the wet floor, the room reconfigured to avoid the water leak, and buckets collected dripping water.

The tribunal was satisfied the respondent had not breached its guarantee to provide the services with “due care and skill” because it took measures to alleviate the problem. It was however satisfied that the water leak and slight delay made the reception not fit for purpose and the guarantee was unaffected by the fact the respondent did not cause the leak.

No award was made under the Australian Consumer law because there was no failure to use due care and skill and the Respondent had not caused the leak. Nevertheless $3,500 was awarded under s79N(a) of the Fair Trading Act 1987. The award was 25% of the contract fee because the quality of service provided was reduced by reason of the water leak and was an amount the tribunal considered fair and equitable to all parties: Nguyen and Sy v The Trustee for the Nero CKD Unit Trust t/as View by Sydney [2017] NSWCATCD 98

David Collins, Senior Solicitor at Mullane & Lindsay Solicitors, NewcastleDavid Collins is a Senior Solicitor at Mullane & Lindsay Solicitors and practises extensively in Commercial dispute resolution and litigationIf you require any assistance in these areas please contact David Collins to arrange a consultation or contact our Newcastle or Sydney office. 

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