Clarendon Homes (NSW) Pty Ltd - s.87B undertaking

In or about June 2000, Clarendon Homes (NSW) Pty Limited ("Clarendon") wrote to all clients who had signed contracts based on a tender dated prior to 29 October 1999 and whose house would not be completed by 1 July 2000, stating they would have to pay GST on the work completed after 1 July 2000 ("affected clients").

Since June 2000, the Commission received a number of complaints from affected clients to the effect that they contracted with Clarendon relying on representations that the price for construction of a house was GST inclusive and therefore, they should not have to pay an additional amount for GST.

On 1 August 2000, the Commission advised Clarendon that by seeking to recover an amount for GST in addition to the contract price from clients who had relied on representations that the contract price was GST inclusive, it may have engaged in misleading or deceptive conduct and made false representations with respect to price in contravention of s.52 and 53(e) of the Trade Practices Act.

To resolve the matter, Clarendon has decided that it will not seek to recover an amount for GST from affected clients and has agreed to institute a trade practices compliance program.