23 May 2018
10 min read
#Property, Planning & Development
Published by:
No licence? No worries
In Precise Builders (NSW) Pty Ltd v Jones & Krel [2018] NSWCATAP 112 the New South Wales Civil and Administrative Tribunal (the Tribunal) Appeal Panel held that a lack of licence was no barrier to the preferred outcome under s.48MA of the Home Building Act 1989 (the Act), upholding a work order over a money order in circumstances where a builder was not properly licensed, but could procure a properly licensed contractor to do the work.
S.48MA of the Act
By way of reminder, s 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. (emphasis added)
Facts
The Owners commenced action in the Tribunal seeking a money order in respect of rectification of defective building works.
The defect had become apparent by way of cracking of the brick parapet wall above the garage, the underlying cause of which was a defect in the steel beam above the garage door supporting the parapet.
Notwithstanding the fact that the Builder did not design or manufacture the steel beam, the Tribunal made a work order under s.48MA of the Act for the Builder “or properly licenced contractors on behalf of the [Builder]” to return to the site and undertake detailed rectification and associated works.
Appeal
The Builder appealed and sought to have the work order set aside and replaced with a money order in the amount of $18,845.84, being the cost of rectifying the defective works as determined by a quantity surveyor. The Builder argued that the Tribunal’s orders were not fair and equitable and the decision was against the weight of the evidence. The Builder submitted that:
The Owners opposed the application for leave to appeal and opposed the substantive appeal on the basis that were no grounds to depart from the statutory presumption in favour of a work order in s 48MA of the Act.
Appeal
The Appeal Panel found that the Tribunal below was correct in making a work order as the order did not require the Builder to perform remedial works that it was not licenced to complete. Rather, it expressly contemplated the possibility that the Builder would engage with one or more licenced contractors in order for the remedial works to be done. For the Builder to contract with a licensed third party would be sufficient compliance with the work order and the Owners would still have the benefits of the statutory warranties and protections provided under the Act, as non-contracting owners.
Given the Tribunal’s work order contemplated that the work would be carried out by a contractor, the Appeal Panel found it was the ideal outcome. As such, the appeal was dismissed.
What does this mean?
This decision closes down one of the few avenues which had been thought to be available to argue against the preferred outcome under s.48MA of the Act. More and more, owners must be mindful that a work order is to be expected in a defects claim for residential building work.
Editorial: Christine Jones, Eleanor Grounds & Christopher Yong
Trucking company fined over 'preventable' deaths of Irish construction workers
The deaths of two workers were preventable because there were "simple and practical steps" the trucking company, Axedale Holdings, could have taken to ensure the panels were secure, the deputy chief magistrate says (17 May 2018). More...
Rising weather risk hits construction industry
The construction industry is facing rising risks from more frequent extreme weather events, Gallagher says in a white paper. Population increases and the cost of building in the current economy are also adding to the impact of weather events and placing more importance on mitigation and preparation (14 May 2018). More...
Building and construction sector to peak soon
Recent infrastructure-heavy State and Federal Budgets will not prevent a peaking in the public investment cycle over 2018/19, according to leading construction industry analyst and economic forecaster, BIS Oxford Economics, officially launching its civil construction report, Engineering Construction in Australia 2018 – 2032 (13 May 2018). More...
Strengthening of noise management for housing around Western Sydney Airport
Recent media reports concerning the noise restrictions for housing around the Western Sydney Airport are inaccurate. NSW Government policy on the standard for noise around Western Sydney Airport has not changed (10 May 2018). More...
ACI Construction Briefs
A fortnightly communication highlighting key updates related to Australia's construction industry.
ACI Construction Brief: Budget sprinkles a dose of fairy dust…but is it enough to win an election? (14 May 2018).
Australian Bureau of Statistics
11 May 2018: Housing Finance, Australia, March 2018 (cat no. 5609.0).
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 to clearly explain planning rules (11 April 2018). More...
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).
Singh v Mohibi t/as Spotless Finishes Painting and Decorating [2018] NSWCATAP 115
The appeal is allowed and the decision made on 23 February 2018 is set aside.
The proceedings are remitted for rehearing by the Tribunal, the parties being permitted to adduce further evidence.
PROCEDURAL FAIRNESS- absence of relevant evidence to support adjournment application- adequacy of reasons for conclusions.
RESIDENTIAL BUILDING WORK - unenforceable contract - requirements for written contract- licence number- statutory warranties- quantum meruit as alternative claim.
Civil and Administrative Tribunal Act 2013 (NSW); Civil and Administrative Tribunal Rules 2014 (NSW); Home Building Act 1989 (NSW). More...
Precise Builders (NSW) Pty Ltd v Jones & Krel [2018] NSWCATAP 112
APPEAL - Home building – Work order – Order to perform or procure performance of remedial work. Appeal dismissed. Civil and Administrative Tribunal Act 2013 (NSW); Home Building Act 1989 (NSW). More...
Reozone Pty Ltd v Rene Santoro & Ors [2018] NSWSC 650
Orders made for payment out of Court. Orders stayed pending the making of final attempts to locate the mortgagor. Funds in Court paid out notably among the applicants.
FUNDS - IN - COURT - surplus funds paid into Court after sale of real property by mortgagee - Trustee Act 1925, s.95 - Uniform Civil Procedure Rules 2005, r.55.11 - mortgagor/registered proprietor cannot be found - orders for substituted service upon mortgagor/registered proprietor made - mortgagor/registered proprietor primarily entitled to fund in Court - orders made for additional notice to be given to mortgagor/registered proprietor - three groups of unsecured creditors apply for payment out of the funds in Court - one has a judgment against the mortgagor/proprietor and the others have unresolved claims - whether payment out of Court should be ordered and if so on what basis - what steps should be taken to determine he unresolved claims.
Civil Procedure Act 2005, ss.98(4)(c), 106(1)(c); Conveyancing Act 1919, ss.23C and 54A; Federal Court of Australia Act 1976, s.52; Home Building Act 1989.
Zeait v Singh [2018] NSWCATAP 109
COSTS – Application of r.38(2) of the Civil and Administrative Tribunal Rules 2014 – meaning of “the amount claimed or in dispute in the proceedings is more than $30,000” - The Costs Decision concerned the costs of matters HB 15/07518 (the homeowners’ application) and HB 15/32783 (the builder’s application). The Tribunal ordered the builder to pay the homeowners’ costs in both applications.
Access Housing Pty Ltd v Rayfield [2018] NSWSC 599
APPEAL – appeal from Appeal Panel of New South Wales Civil and Administrative Tribunal – appeal under s.83 of the Civil and Administrative Tribunal Act 2013 – appeal by leave – appeal “on a question of law” – no basis for alleged errors giving rise to a question of law – leave refused.
Knox v Bollen; Bollen v Knox [2018] NSWCATAP 106
APPEAL – costs where proceedings settled – adequacy of reasons.
Grant v Gillham; Christopher J Grant Pty Ltd v Gillham [2018] NSWCATAP 104
APPEAL: Home building – Identity of contracting parties – Breach – Determination of compensation – Adequacy of reasons.
Islam v Metricon Homes Pty Ltd [2018] NSWCATAP 116
APPEAL – Costs – Gross sum costs orders.
Lucchese v McDonell [2018] NSWCATAP 120
APPEALS – building engineering and related contracts – general contractual principles – termination – accrued rights – remuneration – deposit – cost of rectification – proof of claim – departure from the rules of evidence.
CIVIL PROCEDURE – inferior tribunal – Civil and Administrative Tribunal (NSW) – multiple appeals – practice and procedure – decisions and orders – set-off of amounts found to be owed in separate appeals.
GPM Constructions Pty Limited v Baker [2018] NSWCATAP 119
CONTRACT – whether building contract on foot – whether owner lost entitlement to damages for defective building work in such a case – whether the owner had failed to act reasonably or failed to mitigate her loss by not requesting the builder to return to rectify defects.
HOME BUILDING ACT – s.48MA, preferred outcome principle, relevant considerations, what order is appropriate.
FAIR TRADING ACT – s.79U – applicability in determination of claims under the Home Building Act – modifications required by Home Building Act – relevance of s.48MA of Home Building Act.
DISCRETION – order – making power under s.48O of Home Building Act – application of preferred outcome principle.
Gregorio v Cheadle [2018] NSWCATAP 118
HOME BUILDING ACT – Statutory construction – s.18E proceedings for breach of statutory warranty – limitation period for bringing claim by a successor in title against owner builder – effect of amendment on limitation period – nature of right of successor in title under section 18C of the Home Building Act to bring proceedings for breach of statutory warranties.
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 publication is accurate at the date it is received or that it will continue to be accurate in the future. We are not responsible for the information of any source to which a link is provided or reference is made and exclude all liability in connection with use of these sources.
Published by:
