34 home buyers in Sydney are suing development company Kaymet Corporation in what is believed to be one of the country’s biggest class action of its kind.

The litigants are alleging Kaymet intentionally used a sunset clause to resind the contract between them.

A sunset clause gives the developer the right to pull out of a contract if construction isn’t completed by a stipulated date.

But unscrupulous developers have intentionally triggered the clause when they see property prices rising. They refund the original money and sell the same property for the higher price.

And this is what the plaintiffs are alleging Kaymet to have done.

Between November 2009 and May 2010 the Sydney buyers entered into off-the-pkan contracts to buy luxury apartment complexes in Sydney’s Wolli creek. But in March of 2013 Kaymet Corporation enacted the sunset clause in the contract and refunded their money.

During the time between signing and resinding the contracts the unit prices grew by $50,000 eaqch. Kaymet corporation stood to gain $5 million through reselling the units at current market value.

The plaintiffs say they are able to submit evidence Kaymet Corporation  “did not use reasonable endeavours” to complete the project. In doing so they thereby enacted the sunset clause fraudulently.

But a spokesperson for Kaymet corporation cited several factors making it impossible for them to complete the project. These included water problems, high winds, and interference from council.

Stephen Titus of Carney Lawyers, didsputes this. He says he has obtained independent engineering reports contradicting Kaymet Corporation’s excuses for the hold-ups..

Furthermore, the lawyers will argue that the water, wind, and height disputes with the council were ‘not unexpected’ and so should have been taken into account when planning and setting a date for the applicability of a sunset clause.

Kaymet Corporation is currently in the courts facing an application for winding up of the company.

Leave a Reply

Your email address will not be published.