Jack Smiththe Real Estate Developer

Jack Smithis a real estate developer. He develops residentialtownhousesin theDandenonglocal area. He purchases a large block of land for $2 million and plans to build50 townhouseson the block at a considerable profit. ButDandenongCouncil denies his developmentapplication on the basis of a road widening proposal that will substantially reduce the size of theblockof land. This road widening proposal reduces the value of the block ofJack Smith's land to $1 million.

Jack Smithobtained acouncil certificatefromDandenongCouncil before he purchased theblock of land.He reviews the information in the certificate.If the block of land had been subject to a road wideningproposalthen it should havebeen disclosed byDandenongCouncil in the certificate. There is no such disclosure in thecertificate. AsJack Smithdidn't bother to read the certificate before he purchased the land, he is relievedto find the council has made this

mistake. He secretly knows that ifDandenongCouncil had beencareful and included the road widening disclosure in the certificate, he would not have seen it andgone ahead with the land purchase anyway.

Jack Smithnow wants to sueDandenongCouncil in negligence for economic loss.DandenongCouncilclaims that negligence only applies to physical actions, not written words, and is only applicable tophysical damage to people or their property, not economic loss.

AdviseJack Smith