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Residential Focus

31 July 2019

#Property & Real Estate

Christine Jones

Published by Christine Jones, Jeffery Shi, Divya Chaddha

Residential Focus

Opal Tower unit owners class action

Opal Tower unit owners have launched a class action in the Supreme Court of NSW against Sydney Olympic Park Authority (the Authority), a NSW Government body which owned the land on which the Opal Tower was built. 

Claim against the Authority

The unit owners’ action is based upon the contention that:

  • the Authority is deemed to be a developer within the meaning of the Home Building Act 1989 (NSW) (the Act), as the Authority was the owner of the land on which the Opal Tower was built and retained ownership of a number of lots
  • thereby the Authority owes to the unit owners the statutory warranties implied under the Act
  • the Authority is in breach of the statutory warranties, namely that the Opal Tower was not reasonably fit for occupation and was not built in accordance with the plans and specifications.

Unconventionally, the developer ‘Ecove’ and its contracted builder ‘Icon’ of the Opal Tower are not being pursued by the unit owners in the proceedings, the unit owners apparently preferring the deep pockets of a government entity. It will not be surprising if Ecove and Icon are involved through cross claims.  

What’s at stake?

The unit owners are seeking to recover a significant losses for, amongst other things:

  • the costs incurred by the owners for alternative accommodation from Christmas Eve last year, being the day the owners were forcefully evacuated when significant structural damages on the beam of levels four and 10 were discovered
  • the diminution in property and rental value, particularly for the units that remain unsaleable and unlettable due to the reputational damage. This has been measured by the difference in pre-defect value and current market value
  • loss of rental income for the units which are tenanted.

Premier Gladys Berejiklian has commented that “full weight of the law will be applied if anyone is found to have done the wrong thing”. 

Should the unit owners be successful in their action, any judgment against the Authority will be paid from public funds.

Author: Jeffery Shi and Divya Chaddha 

In the media

Experts divided on ‘crisis’ in Australian construction
While events surrounding the Mascot Towers situation have placed greater attention on the quality of buildings, experts are split on what they believe to be the next appropriate course of action (27 July 2019).  More...

Australian construction industry stabilising
Australia’s construction industry will contract by 2.4% in 2019, but will regain its growth momentum in 2020, according to a report from data analytics and consulting company GlobalData (25 July 2019).  More...

Nathers: New Assessor Accrediting Organisation
On behalf of the NatHERS Steering Committee, the NatHERS Administrator has granted provisional accreditation to a new Assessor Accrediting Organisation (AAO) (25 July 2019).  More...

HIA: Demand for Residential Land Fell in First Quarter
Residential lot sales across Australia fell in the first three months ofthis year to set a new record low for land sales,” said HIA Chief Economist Tim Reardon. This fall in sales can be attributed to the decline in demand for new homes (24 July 2019).  More...

Strengthening land rights at the heart of tackling extreme inequality
Better land governance will help the world address climate change, rapid urbanisation and food, water and resource scarcity, according to Neil Shah, Managing Director at RICS (24 July 2019).  More...

Ministers agree to act on PI impasse
A consultation on professional indemnity insurance is expected in coming weeks after the Building Ministers’ Forum in Sydney last week agreed on a co-ordinated response to the impasse in the troubled construction industry. The near-collapse of the PI market for certifiers and surveyors, triggered by the withdrawal of exemption-free covers, was among key issues discussed at the meeting in Sydney (22 July 2019).  More...

Big step forward for the energy future of Australian homes
The energy efficiency of new homes is set to improve with the nation’s building ministers agreeing to strengthen provisions in the National Construction Code (NCC) for residential buildings. The commitment, made at yesterday’s Building Ministers Forum (BMF) in Sydney (19 July 2019).  More...

Energy efficiency hits home for Australia’s Building Ministers
As we strive to reduce Australia’s carbon emissions, whilst at the same time tackling rising energy bills, the Australian Sustainable Built Environment Council (ASBEC) has warmly welcomed the agreement of building ministers across the country to advance energy efficiency provisions for new homes in the National Construction Code (18 July 2019).  More...

Called on to fix the Australian dream turned 'nightmare', building ministers gather
State and territory building ministers agree to create a nationally consistent approach to reform the industry, but residents of the now abandoned Mascot Towers say more needs to be done to help apartment owners stuck with defective units. (18 July 2019).    More...

National agreement to lead to better building standards and regulation
The Property Council of Australia has welcomed the agreement by Commonwealth, State and Territory building ministers on a national approach to implementation of reforms which will lead to better enforcement and compliance with building standards and regulation (18 July 2019).  More...

HIA: National approach to building reforms an important agreement
It is is important that the end result after implementation will essentially be to deliver a consistent approach to the way buildings are approved, to the way building professionals are held responsible and to providing greater certainty for building owners (18 July 2019).  More...

MBA: Builders back national agreement on urgent national regulatory reforms
Master Builders welcomes the agreement by state and territory building minsters to work with the Federal Government to implement the Shergold-Weir report recommendations (18 July 2019).  More...

PCA: Joint Statement by industry groups on building regulation
Australia’s fragmented approach to regulatory enforcement and compliance with building regulations requires a renewed commitment to national action to maintain public confidence in our built environment (15 July 2019).  More...

'It’s a joke. We can’t go on like this': fourth block of units abandoned in Sydney
An Erskineville apartment development remains a ghost town more than 12 months after it was completed (19 July 2019).  More...

Prominent Sydney buildings at risk from combustible fire cladding
More than 40 Sydney buildings need combustible fire cladding replaced due to the risk of fire, new documents released under freedom of information laws reveal (18 July 2019).  More...

NHFIC in social housing financing spree includes first construction loans
The National Housing Finance and Investment Corporation has announced more than $85 million in finance for social and affordable housing across NSW (18 July 2019).  More...

Practice and courts

New Australian Standards
DR AS/NZS 2280:2019
Ductile iron pipes and fittings Standards Australia
DR AS/NZS 2980:2018 Amd 1:2019
Qualification of welders for fusion welding of steels - Additional requirements for Australia and New Zealand Standards Australia

GBCA Important Deadlines - Green Star certification for your project
Many project teams have timelines set around major events. To support this, these guidelines below (based on typical time frames), which specify the deadlines you’ll need to meet in order to have your project certified in time for key milestones in 2019. Deadlines are from 08 April – 04 November 2019.  More...

NSW Fair Trading: Have your say on the Building Stronger Foundations discussion paper
The NSW Government is continuing to progress reforms to the building and construction sector through the release of a discussion paper, Building Stronger Foundations (the discussion paper). We are seeking feedback on the scope of the reforms outlined in the Response and how they can be integrated into building regulation and the NSW planning and approvals system.   More... 

New dates for Environmental Planning & Assessment Act Updates
Councils, certifiers and other industry practitioners have more time to implement some of the recent EP&A Act updates. Changes affect new provisions for building and subdivision certification, Local Strategic Planning Statements for councils in the Greater Sydney Region and Community Participation Plans.
There will be a number of other changes that will involve further design and consultation from mid to late 2018 outlined here


The Owners – Strata Plan 83572 v Jackson Teece Chesterman Willis Pty Ltd [2019] NSWSC 942
BUILDING AND CONSTRUCTION – residential building work – statutory warranties – remedial work to leaking façade – scope of work to be undertaken by the remedial builder – whether work done without due care and skill – whether any loss shown to have resulted from builder’s work

Sydney AC Pty Ltd v Commissioner for Fair Trading, Department of Finance, Services and Innovation [2019] NSWCATOD 116
ADMINISTRATIVE REVIEW – Home building – Where respondent decided not to grant application for renewal of applicant’s contractor licence – Where applicant was subject to Tribunal order which had not been satisfied within required period – Where applicant had not complied with order after that period – Meaning of “satisfied”

Magerovski v Commissioner of Fair Trading [2019] NSWSC 931
(1) Dismiss the notice of motion filed by the plaintiff and Georges River Holdings Pty Limited on 12 July 2019.
JURISIDICTION – Supreme Court has no jurisdiction to grant a stay where there is no challenge in proceedings commenced in this Court to the underlying decision sought to be stayed – stay application to be made to Civil and Administrative Tribunal
Home Building Act 1989
(NSW); Licencing and Registration (Uniform Procedures) Act 2002 (NSW)

K & K Ventures Pty Ltd v Attar [2019] NSWCATAP 182
APPEAL – Costs – rule 38 – rule 38A - no requirement to establish special circumstances – capitulation by respondent on appeal – acceptance of absence of jurisdiction under Home Building Act 1989 - general discretion to award costs – costs awarded on appeal – costs awarded at first instance from date jurisdiction put in issue.

Petropoulos v CPD Holdings Pty Ltd t/as The Bathroom Exchange [2019] NSWSC 897
APPEALS – Judicial review – Application for leave to appeal and cross appeal from a decision of the Appeal Panel of the New South Wales Civil and Administrative Tribunal – Civil and Administrative Tribunal Act 2013 (NSW), s 83 – Appeal on a question of law – Contract for a bathroom renovation – Whether an oral variation is effective despite a clause requiring variations to be in writing – Whether the plaintiff waived her right to insist upon the contractual specifications – Whether the builder breached statutory warranties under the Home Building Act 1989 (NSW) s 18B – Whether rectification is an unreasonable remedy where the plaintiff had agreed to the variations. Civil and Administrative Tribunal Act 2013 (NSW), ss 83, 84; Civil Procedure Act 2005 (NSW), ss 58, 60; Home Building Act 1989 (NSW), ss 7, 10, 18B, 18E, 48K, 48MA, 48O

Betta Build Group Pty Ltd v El Baba [2019] NSWDC 331
BUILDING AND CONSTRUCTION – construction works for residential dwelling – whether breach of statutory warranties under Home Building Act 1989 (NSW) – whether works defective or incomplete.
DAMAGES – whether Bellgrove v Elridge measure of damages applicable – relevance of sale of dwelling to purchaser – whether scope of rectification works as proposed by home owner’s building expert reasonable and appropriate. PRACTICE AND PROCEDURE – referral of issue of costs of rectification to referee.
Home Building Act 1989 (NSW)

Ngo v Commissioner for Fair Trading, Department of Finance, Services and Innovation [2019] NSWCATOD 103
ADMINISTRATIVE REVIEW – Home Building – Supervisor certificate – Where respondent refused to grant applicant supervisor certificate - Whether applicant had experience which would enable him to do, or to supervise, the work for which the certificate is required – Whether the Tribunal should depart from a policy known as the “Instrument” – Whether application of the policy would produce an unjust decision – Whether the Tribunal may take into account uncorroborated evidence given by the applicant about his construction experience

Clarke v Bowen [2019] NSWCATAP 163
CONSUMER CLAIM – against the weight of evidence – fair and equitable – excessive damages

Slotwinski v Nutek Constructions Pty Ltd; Nutek Constructions Pty Ltd v Slotwinski [2019] NSWCATAP 158
Appeal – Determination of quantum meruit claim – Failure to consider expert evidence relevant to the assessment of a builder’s quantum meruit claim – quantification of quantum meruit entitlement - Leave to appeal granted – Appeal allowed – remittal for further consideration of quantum meruit claim.



Proclamations commencing Acts
Building and Construction Industry Security of Payment Amendment Act 2018 No 78 (2019-340) — published LW 19 July 2019

Regulations and other miscellaneous instruments
Building and Construction Industry Security of Payment Amendment Regulation 2019 (2019-341) — published LW 19 July 2019

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.

Christine Jones

Published by Christine Jones, Jeffery Shi, Divya Chaddha

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