04 July 2018
14 min read
#Property, Planning & Development
Published by:
Clements v Murphy [2018] NSWCATAP 152
In Clements v Murphy [2018] NSWCATAP 152, the New South Wales Civil and Administrative Tribunal Appeal Panel (Appeal Panel) has provided further guidance on section 48MA of the Home Building Act 1989 (NSW) (the Act), as to whether it applies to incomplete work.
Section 48MA of the Act provides:
“A court or tribunal determining a building claim involving an allegation of defective residential building work or specialist work by a party to the proceedings (the "responsible party") is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome.”
Facts
The Owners entered into a contract with the Builder to construct a home (Contract). When a dispute arose regarding payment claims lodged by the Builder, the Builder served a notice purporting to terminate the Contract, which the Owners accepted and treated as a repudiation of the Contract.
The Owners commenced then proceedings in the New South Wales Civil and Administrative Tribunal (Tribunal) seeking an order for the Builder to complete the works under the Contract or, in the alternative, for the Builder to pay the costs to complete the incomplete works under the Contract.
The Tribunal found the Owners had validly terminated the Contract and ordered the Builder to rectify 15 items of defective work and pay the Owners a sum of $45,054.79 for the incomplete works.
Appeal
The Builder sought leave to appeal, submitting that the Tribunal had erred in:
The Builder submitted that:
The Owners opposed the application for leave to appeal.
Decision
The Appeal Panel held that the Tribunal was correct in ordering the Builder to rectify the items of defective work and to pay the Owners for the incomplete works.
As to the submission that incomplete work was defective work, the Appeal Panel noted:
"There may be some room for debate in individual cases as to whether a particular matter complained of is incomplete or defective work. For example, a failure to install handles on kitchen cupboards may be argued to be incomplete work, but may also be characterised as defective work. However, in general terms, a failure to install major building elements such as windows or a roof would clearly constitute incomplete work and could not properly be characterised as defective work."
As to the common law right to rectify, the Appeal Panel held that it did not include a right to complete incomplete work after a contract has been terminated.
Whilst the Appeal Panel acknowledged that section 48MA was not intended to limit the power of the Tribunal with respect to making orders in building claims, it considered that this did not assist in considering whether “defective work” in section 48MA extended to work which is incomplete.
The Appeal Panel agreed with the Tribunal below in its finding that section 48MA is not intended to apply to work which is incomplete and which cannot be characterised as defective work. This leaves room open for the ‘debate’ in some instances as to proper characterisation, as referred to above.
The Appeal Panel concluded that where “a building contract has been terminated prior to completion of the work by reason of the builder’s repudiation, it would be unusual for the Tribunal to direct the builder to return to complete the work. In our view, on its true construction, s 48MA does not require the Tribunal to consider that that should be the preferred outcome.”
What does this mean?
Whilst section 48MA has changed the landscape for applicants in home building disputes, this decision is an important marker in terms of the limits of its application in circumstances where the contract has been terminated prior to completion.
Editorial: Christine Jones, Eleanor Grounds & Christopher Yong
Brendan Crotty appointed inaugural National Housing Finance and Investment Corporation chair
Director of Brickworks, General Property Trust and Dennis Family Holdings Brendan Crotty has been appointed the inaugural chair of the federal government’s National Housing Finance and Investment Corporation (NHFIC) (26 June 2018). More...
Construction industry safety blitz underway
Figures from SafeWork NSW revealed falls from heights incidents had more than tripled in the last five years, prompting a 12 month safety blitz that kicked off in November last year. SafeWork inspectors have so far visited more than 460 construction sites in NSW, and issued $115,000 in fines over breaches to safety laws (29 June 2018). More...
Newcastle and Hunter residents warned about unlicenced asbestos removalist
Consumers are being warned about an unlicenced asbestos removalist targeting Newcastle and Hunter Valley residents. From 1 July 2018, residents can check if a licenced asbestos removalist has received any penalty notices on the SafeWork NSW Licence Register (20 June 2018). More...
ACI Construction Briefs
A fortnightly communication highlighting key updates related to Australia's construction industry (25 June 2018). More...
Australian Bureau of Statistics
27/06/2018 Engineering Construction Activity, Australia, Mar 2018 (cat no. 8762.0)
Nathers Newsletter No 6 2018
Published 28 June 2018 – Chenath updates for 2019; NatHERS Assessor Handbook; Split heating and cooling loads for NCC 2019; Trajectory for Low Energy Homes and NCC 2022.
NTC Reminder: New changes for the transport of dangerous goods
The Australian Code for the Transport of Dangerous Goods by Road and Rail is set to be updated with changes designed to reduce the burden on industry when transporting low-risk items and bring into line with new United Nations transport requirements. In May, Transport ministers approved version 7.6 of the Code, with the changes effective from 1 July 2018 and compulsory from 1 July 2019. More...
prefabAUS Conference 2018
11th - 12th September, 2018 Brisbane Convention & Exhibition Centre. More...
New Building Standards
AS/NZS 1577:2018
Scaffold decking components - Standards Australia
AS 2050:2018
Installation of roof tiles - Standards Australia
AS/NZS 3000:2018
Electrical installations (known as the Australian/New Zealand Wiring Rules) - Standards Australia
AS 4386:2018
Cabinetry in the built-in environment - Commercial and domestic - Standards Australia
AS 3600:2018
Concrete structures - Standards Australia
New South Wales
NSW BPB: Certification data reporting – compliant software available now
Building Certification Systems (BCS) certification software is fully compliant with the data reporting requirements. As of 1 July 2018, local councils and accredited certifiers (A1, A2 and A3) are now required to report certification data for principal certifying authority (PCA) work. Data must be reported from the commencement of building work through to the issue of the final occupation certificate (25 June 2018). More...
NSW BPB: Building Certification Systems (BCS) clients
BCS certification software is now fully compliant with NSW data reporting requirements through use of an API. Existing clients should already have been contacted by BCS. As products are verified by the NSW Government as fully compliant they will be listed on the Building Professionals Board website. Other products are expected to be verified very soon and all certifiers and councils will be directly notified (25 June 2018).
NSW BPB: Certification data reporting mandatory from 1 July 2018
The Secretary’s Order to introduce mandatory data reporting by A1-A3 certifiers and local councils has been gazetted. Data reporting is now mandatory as of 1 July 2018. To enforce compliance, the Building Professionals Board will focus on education in the first six months to help certifiers and councils meet requirements (25 June 2018). More...
More housing options for NSW: Low Rise Medium Density Housing Code
The new Code will allow one and two storey dual occupancies, manor houses and terraces to be built under fast-track complying development approval across NSW and also promotes good design for medium density housing. Low rise medium density housing as complying development is only allowed where medium density development is already permitted under a council’s local environmental plan. The Medium Density Housing Code will commence on 6 July 2018.
Greenfield Housing Code
The changes start on 6 July 2018. The new Code will be included in the State Environmental Planning Policy (Exempt and Complying Development Codes) 2008. In essence, it is a simplifying of the development process and aligning the requirements for development across greenfield areas. The planning rules and the code are also presented in plain English for clearer explanation. Note: There will be a three-year transitional period, where applicants can choose whether to use the Greenfield Code, or the new simplified Housing Code or Transitional Code (until 13 July 2019). More...
BPB: Certification data reporting commenced 1 July 2018
To strengthen certification and building regulation in NSW, accredited certifiers and local councils are now required to report data on building certification to the NSW Government. More...
Carlisle Homes Pty Ltd v Tick Homes Pty Ltd [2018] FCA 973
COPYRIGHT – application for an interlocutory injunction restraining reproduction and sale of house plans and building houses in accordance with the plans – allegation of copying house plans in infringement of copyright in the plans – prima facie case established – damages an adequate remedy – balance of convenience against grant of interlocutory injunction – application dismissed. Copyright Act 1968 (Cth).
Simpson & anor trading as Almar Pioneer Interiors v Griffiths [2018] NSWSC 1010
CIVIL PROCEDURE – jurisdiction – where building claim brought in Local Court – where Magistrate refused plaintiffs’ application to transfer proceedings to Civil and Administrative Tribunal – plaintiffs sought interlocutory orders in Supreme Court – no appearance by defendant – matter to be heard in Local Court day after interlocutory hearing – Home Building Act 1989 (NSW) s 48L requires Magistrate to transfer proceedings on application to the Civil and Administrative Tribunal – plaintiff has an arguable case as to error – Local Court proceedings stayed until further orders.
Building and Construction Industry Security of Payment Act 1999 ss 15, 16, 25; Civil and Administrative Tribunal Act 2013 Sch 4; Home Building Act 1989 (NSW) s 48L; Supreme Court Act 1970 (NSW) s 66.
Lee v Commissioner for Fair Trading, Department of Finance, Services and Innovation [2018] NSWCATOD 101
ADMINISTRATIVE LAW – home building – supervisor certificate – where respondent refused applicant’s application for a supervisor certificate on grounds that he was not a fit and proper person – where applicant had convictions for drug supply and possession committed about four years ago – where applicant claimed to have been rehabilitated – whether applicant had deliberately concealed criminal history on his application form – whether a person may be fit and proper whilst still serving a sentence in the community.
Zeait v Singh (No 2) [2018] NSWCATAP 159
1. A hearing is dispensed with pursuant to s 50(1)(c) of the Civil and Administrative Tribunal Act 2013 (NSW).
2. The appellant is to pay the respondent’s costs of the appeal, as agreed or as assessed.
COSTS – application of r 38A of the Civil and Administrative Tribunal Rules 2014 (NSW) – no question of principle.
Civil and Administrative Tribunal Rules 2014 (NSW); Civil and Administrative Tribunal Act 2013 (NSW); Home Building Act 1989 (NSW).
Catapult Constructions Pty Ltd v Denison [2018] NSWCATAP 158
APPEAL – Home Building Act – s 48O, extent of jurisdiction, nature and extent of order making power, “perform any specified work or service or obligation under Act or agreement” – breach of statutory warranties – breach of contract – discretion – order to perform any “specified act”.
Wilson v Dash (No.2) [2018] NSWCATAP 155
2. The appellants must pay the respondent’s costs of the appeal such costs if not agreed to be assessed on a party/party basis pursuant to the provisions of the Legal Profession Uniform Law Application Act 2014.
Costs - gross sum cost order.
Civil and Administrative Tribunal Act 2013 (NSW); Civil and Administrative Tribunal Rules 2014; Home Building Act 1989 (NSW); Legal Profession Uniform Law Application Act 2014 (NSW).
Clements v Murphy [2018] NSWCATAP 152
BUILDING AND CONSTRUCTION – home building – whether the preference for rectification of defective work by the responsible contractor arising from s48MA of the Home Building Act applies in relation to incomplete work.
WORDS AND PHRASES – “defective work”.
Civil and Administrative Tribunal Act 2013 (NSW); Civil and Administrative Tribunal Rules 2014 (NSW); Home Building Act 1989 (NSW) ss 48MA, 48O.
Harris v Morabito Holdings [2018] NSWSC 912
BUILDING AND CONSTRUCTION – adoption of referee’s report – discretion to adopt to be exercised judicially and with regard to the purpose for which discretion to refer is given – where report is factually thorough and reaches conclusions open on the evidence – where most errors complained of involve an attempt to reargue on the merits – exception regarding conclusions on delay and variations where there was a denial of natural justice – referee’s report adopted in whole with the exception of conclusions regarding delay and variations.
CONTRACT – interpretation of building contract –distinction between the interpretation of the terms of a contract and standard or extent of performance required to satisfy those terms.
Civil Procedure Act 2005 (NSW); Home Building Act 1989 (NSW); Supreme Court Rules 1970 (NSW).
Uniform Civil Procedure Rules 2005 (NSW).
Tom v Jenkins [2018] NSWCATCD 7
Time for bringing proceedings – section 48K(3) of the Home Building Act 1989.
Webster v Tom [2018] NSWCATCD 6
Reasonably fit for occupation as a dwelling.
Jandson Pty Ltd v Syed Ahmad Shoaib Ali Pty Limited As Trustee for Syed Family Trust and Ors [2018] NSWCATCD 5
BREACH OF CONTRACT - repudiation– cause of action arising under contract – whether s94(1A) of the Home Building Act 1989 is a bar to a claim for damages for breach of contract in circumstances where no home warranty insurance policy was issued - quantum meruit.
Regulations and other miscellaneous instruments
Heavy Vehicle (Adoption of National Law) Amendment (Penalties) Regulation 2018 (2018-353) — published LW 29 June 2018
Heavy Vehicle (Adoption of National Law) Amendment Regulation 2018 (2018-354) — published LW 29 June 2018
Road Transport (Vehicle Registration) Amendment (Heavy Vehicles) Regulation 2018 (2018-335) — published LW 29 June 2018
Road Transport Legislation Amendment (Fees, Penalty Levels and Charges) Regulation 2018 (2018-334) — published LW 29 June 2018
Work Health and Safety Amendment (Fees) Regulation 2018 (2018-338) — published LW 29 June 2018
Heavy Vehicle (Registration) National Regulation (2018-298) — published LW 22 June 2018
Heavy Vehicle National Legislation Amendment Regulation 2018 (2018-299) — published LW 22 June 2018
Road Transport (Minimum Toll Expenditure Calculation) Amendment Order 2018 (2018-281) — published LW 22 June 2018
Surveying and Spatial Information Amendment (Fees and Deposits) Regulation 2018 (2018-283) — published LW 22 June 2018
Contacts:
Christine Jones, Partner - Construction & Infrastructure (Dispute Resolution)
T: +61 2 8083 0477
E: christine.jones@holdingredlich.com
Stefanie Dunnicliff, Senior Associate
T: +61 2 8083 0464
E: Stefanie.Dunnicliff@holdingredlich.com
Divya Chaddha, Associate
T: +61 2 8083 0457
E: Divya.Chaddha@holdingredlich.com
Disclaimer
The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this newsletter is accurate at the date it is received or that it will continue to be accurate in the future.
Published by:
