Australia: Residential Focus NSW - 24 May 2017

EK Constructions Pty Ltd v Zhu [2017] NSWCATAP 102

The NSW Civil and Administrative Tribunal (NCAT) Appeal Panel recently considered an appeal by a builder who claimed that the Tribunal had erred in finding that the owner had standing to make a claim for breach of statutory warranties under the Home Building Act 1989 (NSW) (the Act). The builder also claimed that it was denied procedural fairness by the failure to give any weight to its expert evidence.

Standing

The builder submitted that the Tribunal made an error of law by hearing the application of the owner as he was not a party to the contract for residential building work.

The facts of this case are such that the owner had entered into the contract with the builder not in his own name, but in the name of a company of which he was a director. This was reflected by the fact that the work order was issued on company letterhead, the quote identified the company as the client and tax invoices were issued to the company rather than the owner in his personal capacity.

The Appeal Panel therefore held that the contract was between the company and the builder.

However, the Appeal Panel looked to section 18D (1A) of the Act in determining that the statutory warranties extended to a non-contracting owner, thereby, granting the owner standing to bring proceedings.

The Appeal Panel also noted that as the statutory warranty had not been previously enforced by the company the exception under section 18D (2) did not apply.

Failure to give weight to expert evidence

The builder contended that the failure to afford weight to their expert evidence amounted to a breach of procedural fairness.

It was submitted that as the expert evidence was deficient in some respects, the Tribunal should have given the builder a short adjournment allowing it to remedy any defects. This submission was grounded in the fact that the builder was not represented by a lawyer, but by a director of the builder.

In response, the Appeal Panel found that there will be no breach of procedural fairness where the Tribunal considers evidence and then decides to afford it little or no weight. Similarly, the Appeal Panel confirmed that the Tribunal is not obliged to offer a party an adjournment in order to provide time for a party to improve their expert evidence. Provided the Tribunal has given the party a reasonable opportunity to deliver expert evidence it has fulfilled its requirements regarding procedural fairness.

The Appeal Panel also reiterated the reasons of the Tribunal for its decision to afford the expert evidence little to no weight. Firstly, it was held that the expert had not complied with the Civil and Administrative Tribunal Expert Code of Conduct. This alone is a sufficient basis for according a report little or no weight. Secondly, it was also held that Tribunal was not satisfied that the opinion of the expert was impartial. In relying on a report that advocated for one party, rather than expressing an impartial view, the Appeal Panel found that it was open to the Tribunal to give significantly reduced weight or no weight to that specific evidence.

The appeal was dismissed.

In the media

MBA: Budget Boost for Housing New economic modelling commissioned by Master Builders Australia forecasts that the $75 billion infrastructure and housing affordability measures announced in the Budget will deliver a substantial 41% boost to the supply and affordability of housing (19 May 2017). More...

Master Builders Australia Federal Budget 2017-18 Master Builders Australia has developed a response to the Federal Budget. The response includes topics such as the economy, housing affordability, infrastructure investment, and jobs (11 May 2017). More...

Federal budget a good balance for housing supply and affordability The Federal Government has achieved a good balance between encouraging more housing supply as well as policies that make housing more affordable, says the urban Taskforce (10 May 2017). More...

Developers welcome Budget's $70 billion infrastructure measures The federal government's new measures to build more infrastructure and make housing more affordable have been welcomed by the development sector. Under the new measures outlined in the 2017-18 Budget released on 9th May, the federal government has allocated $1 billion for critical infrastructure and $70 billion for transport infrastructure (May 2017). More...

Federal budget round-up: how the built environment sector reacted There's been a mixed reaction to the federal budget, with mostly positive responses to a focus on infrastructure spending, mixed responses to housing affordability measures and dismay at the silence on the environment and climate change (10 May 2017). More...

Five-point plan to solve NSW's housing affordability crisis The Property Council will today release a five-point plan to assist the NSW Government solve the housing affordability crisis in NSW. Property Council NSW Executive Director Jane Fitzgerald said the five-point plan is a blueprint for action (12 May 2017). More...

Published

Housing supply responsiveness in Australia: distribution, drivers and institutional settings Rachel Ong et al: Australian Housing and Urban Research Institute 18 May 2017 This study investigated the key drivers of Australian housing supply responsiveness; including price, topographical constraints, climate, existing land uses and planning regulations; and considered policy development options to improve the scale and speed of new housing supply responses. More...

Practice and courts

Senate Inquiry Update Non-conforming building products Status: Accepting Submissions; Date Referred: 11 October 2016; Submissions Close: 01 December 2016; Reporting Date: 25 May 2017.

NSW Planning & Environment: Building System Circulars Safety of awnings over public lands BS 17-001 (10 May 2017).

Cases

Wall v Commissioner for Fair Trading [2017] NSWCATOD 76 MERITS REVIEW - Home Building Act 1989 - Individual Contractor Licence – Experience requirements – Referee Statements.

Commissioner for Fair Trading v Younan (No.2) [2017] NSWCATAP 115 APPEAL – Civil and Administrative Tribunal – costs – submissions on issue no longer a matter for decision – special circumstances.

Daoud v Hammoud [2017] NSWCATAP 114 APPEAL – home owners' renewal application in respect of defective and incomplete residential building work – builder's cross application for balance of contract price including variations – adequacy of reasons on particular disputed items - procedural fairness - appeal allowed in part.

3D Design & Build Pty Ltd v Kay [2017] NSWCATAP 110 APPEAL – Home Building Act – renewal proceedings – findings in relation to rectification works – not against weight of evidence – no new evidence has arisen that was not reasonably available in the proceedings under appeal – leave to appeal refused.

Jackson v N K Tiling Pty Ltd [2017] NSWCATAP 106 PROCEDURAL FAIRNESS: rejection of documents not served in accordance with directions and for which no extension of time sought; where party did not understand requirement to seek extension; whether adjournment should have been offered by Tribunal.

Owners Corporation SP 79417 v Trajcevski [2017] NSWCATAP 101 APPEAL – Civil and Administrative Tribunal – inadequate specification of questions of law – appeal dismissed NEGLIGENCE – Owners Corporation – no duty of care HOME BUILDING ACT 1989 – S 3B – proper construction – date of completion LEAVE TO APPEAL – no substantial miscarriage of justice – application for leave dismissed.

EK Constructions Pty Ltd v Zhu [2017] NSWCATAP 102 STATUTORY CONSTRUCTION – Home Building Act 1989 (NSW) s 18D(1A) – residential building work - right of non-contracting owner to claim for breach of statutory warranty EVIDENCE – expert evidence – Tribunal gave expert evidence little or no weight – whether breach of procedural fairness.

Ferguson v Riviera Building & Construction Pty Ltd;; Riviera Building & Construction Pty Ltd v Ferguson [2017] NSWCATCD 16 HOME BUILDING-repudiation and termination of contract, incomplete and defective works, home owners damages, builders damages, quantum meruit claim, interest on damages, liquidated damages, interests of justice served in allowing reopening of case after hearing.

Legislation

Bills assented to
Gas and Electricity (Consumer Safety) Act 2017 No 15 — Assented to 09 May 2017 See Gas and Electricity (Consumer Safety) Bill 2017.

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