Little did the agent know that when he mistakenly handed over the keys of a residence that adjoined and was identical to the one a buyer had actually acquired,  he had triggered a legal storm that would erupt six years later.

Nawaz Sohtra purchased the property at 54 O’Reilly Road, Tarneit on the western outskirts of Melbourne in February 2013. He then subdivided it and built two identical homes on each of the two lots.

His intention was to retain No 54A on Lot 2 as a passive investment and to sell off No 54B on Lot 1.

It wasn’t long before Mukesh Kumar of Reliance Real Estate found a buyer who – in June 2016 – settled on the buy of Lot 1 with vacant possession for the sum of $285,000.

Shortly after settlement Mamatha Peddi and her husband arrived at Reliance’s office and were handed the keys.

Sohtra also engaged Reliance to rent out the other property for him which it did successfully up until 2020.

In February that year Sohtra listed No 54A with Mr Kumar’s agency for sale only to discover it had been occupied since August 2016 by Ms Peddi and then later by her tenants.

He asked Kumar to contact Ms Peddi to arrange a meeting so that the matter could be discussed and resolved amicably by way of a home swap.

When that plan failed, he engaged lawyers who in March 2021 also offered an amicable resolution by allowing her possession of No 54B in return for her yielding up No 54A.

Her response was to claim that she was occupying the property that she had inspected prior to the purchase which – she contended – must have been misrepresented to her as the one she had signed up to buy.

Sohtra persisted with his demand through his lawyers and in October 2021, changed the locks on the front door to the premises only to learn that Peddi subsequently engaged another locksmith to change them again.

Notwithstanding the demands she refused to give up possession of the property.

When Sohtra called on Kumar to provide an affidavit as to how the confusion about delivery of the keys after settlement arose – for use in evidence – he went to ground.

Proceedings were filed by Sohtra in the Supreme Court of Victoria in October 2022 to recover possession of No 54A on the basis that as he was the registered proprietor, Peddi’s occupation was a trespass that denied him the use and enjoyment of the property.

Associate Justice Derham observed – in a hearing at which Mrs & Mrs Peddi did not appear and were not legally represented – that the sale contract was not invalidated by any “omission or mistake in the description or area of the land” and that “the purchaser cannot make any objection or claim for compensation for any misdescription” following settlement.

He also noted that the tort of trespass “is concerned with protecting the right to exclusive possession of land, rather than ownership….however the party with immediate right to possession may often be, and in this case is, the owner”.

Peddi was – he ruled – a mere licensee under an implied licence having been let into possession by Kumar as agent of the owner by mistake.

But because from at least March 2021 she knew that any implied license to occupy the premises must have elapsed, her subsequent “interference with the land” had been unauthorised.

“It is clear that an order should be made for the plaintiff to recover possession of the Subject Property….. including possession of the rents and profits arising from the property,” he declared.

He also ruled that Peddi should pay the owners legal costs on an indemnity basis given that she had refused “very reasonable offers to resolve the situation and properly advised, should have known she had no means of successfully defending the claim”.

There is no mention in the judgement of any fallout concerning the real estate agent Mr Kumar or whether Peddi was able to recover the rents received by Sohtra on her property – No 54B – over the same period.

Sohtra v Peddi [2023] VSC 262 Derham AsJ, 18 May 2023


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