AG Advanced Construction Pty Ltd v Shao - [2018] VSC 116

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

S CI 2017 02745

AG ADVANCED CONSTRUCTION PTY LTD (ACN 089 153 597)	Plaintiff
v
WENLI SHAO	Defendant

---

JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	13 November 2017, further written submissions filed 31 January 2018
DATE OF JUDGMENT:	22 March 2018
CASE MAY BE CITED AS:	AG Advanced Construction Pty Ltd v Shao
MEDIUM NEUTRAL CITATION:	[2018] VSC 116

---

DOMESTIC BUILDING CONTRACTS – Application under s 148 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) (‘VCAT Act’) for leave to appeal and appeal from VCAT decision – Owner engaged builder to construct new home on property pursuant to domestic building contract – Substantial delays in progressing and completing the building works – Owner terminated contract pursuant to s 41 of Domestic Building Contracts Act 1995 (Vic) (‘Act’) –VCAT orders for recovery of damages by owner from builder – Whether any error of law – Whether owner who has terminated a domestic building contract under s 41 of the Act is entitled to recover damages from a builder for defective work completed before termination – Consideration of implications of s 41 reliance for subsequent damages claims including for loss of bargain consequent upon termination and for defective works – Secretary to the Department of Premier and Cabinet v Hulls [1999] 3 VR 331, applied – Act, ss 8, 41 and 53 – Error of law – Application for leave granted – Appeal allowed – VCAT orders set aside.

JUDICIAL REVIEW AND APPEALS – Owner sought order against builder for refund of overpayment pursuant to s 148(7)(b) of the VCAT Act after hearing of the application for leave to appeal – Whether appropriate in the circumstances to make a s 148(7)(b) order – Reliance upon s 41 of the Act not to preclude a party from seeking a s 148(7)(b) order – Christ Church Grammar School v Bosnich & Sehr [2010] VSC 476, applied – No claim for restitution made in VCAT proceeding – Section 148(7)(b) order not appropriate in the circumstances.

---

APPEARANCES:	Counsel	Solicitors
For the Plaintiff	Mr P D Corbett QC with Mr C M Fenwick	Portfolio Law Pty Ltd
For the Defendant	Mr R Andrew with Mr N J Philpott	Oldham Naidoo Lawyers

HER HONOUR:

Introduction and background

This is an application for leave to appeal from an order made by Senior Member Walker of the Victorian Civil and Administrative Tribunal (‘VCAT’) made on 21 June 2017, whereby the Senior Member ordered that the plaintiff in this proceeding (‘builder’) pay the defendant (‘owner’) the sum of $93,153. The builder seeks to have that order set aside. The sole issue in this application is whether an owner who has terminated a domestic building contract under s 41 of the Domestic Building Contracts Act 1995 (Vic) (‘Act’) is entitled to recover damages from a builder for defective work completed before termination. On…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Keep reading for free

Create a free CaseChat account to read AG Advanced Construction Pty Ltd v Shao and more:

Read every judgment in full
Ask AI and get answers linked to paragraphs
See how each paragraph was cited in later cases
Download judgments as PDF or Word

Continue with Google

One click creates your free account or signs you in.

By continuing you agree to the Terms and Privacy Policy.

Details

Case: [2018] VSC 116
Decision Date: 22 March 2018

CaseChat Overview and Summary

AG Advanced Construction Pty Ltd v Shao involved a dispute between the builder, AG Advanced Construction Pty Ltd, and the homeowner, Shao, concerning a domestic building contract. Shao had engaged the builder to construct a new home, but significant delays and issues arose during the project. Shao terminated the contract under section 41 of the Domestic Building Contracts Act 1995 (Vic) and subsequently sought damages from the builder for defective work completed prior to the termination. The Victorian Civil and Administrative Tribunal (VCAT) ordered the builder to pay damages to Shao. The builder appealed to the court, arguing that Shao could not recover damages for work completed before the termination.

The court had to decide whether there was an error of law in VCAT's decision and if a homeowner who terminates a domestic building contract under section 41 of the Act is entitled to recover damages for defective work completed before termination. The court considered the implications of section 41 of the Act in relation to subsequent damages claims, including loss of bargain claims following termination, and defective works. The court applied Secretary to the Department of Premier and Cabinet v Hulls and concluded that the VCAT had erred in allowing Shao to recover damages for work completed before the contract was terminated.

The court found that there was an error of law in VCAT's decision and granted the builder leave to appeal. The appeal was allowed, and the orders made by VCAT were set aside. Additionally, the court considered a claim by the owner for a refund of overpayment pursuant to section 148(7)(b) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) but determined that it was not appropriate in the circumstances, as no claim for restitution had been made in the VCAT proceedings.

Orders