Bailey v Champion Homes Sales Pty Ltd - [2017] NSWCATCD 91

Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation: Bailey v Champion Homes Sales Pty Ltd [2017] NSWCATCD 91
Hearing dates: 13 & 14 September 2017
Date of orders: 15 November 2017
Decision date: 15 November 2017
Jurisdiction: Consumer and Commercial Division
Before: G K Burton SC, FCIArb, Senior Member
Decision:
Respondent to pay applicants $80,433 on or before 22 November 2017.
Respondent to pay applicants’ costs of the proceedings as agreed or assessed on the ordinary basis to and including 4 April 2017 and on the indemnity basis on and from 5 April 2017.

Catchwords: Home building; variations; contract period; works period; restitution; mistake; failure of consideration; breach of warranty; damages
Legislation Cited: Home Building Act 1989 (NSW)
Civil and Administrative Tribunal Act 2013 (NSW)
Cases Cited: Mackay v Dick (1881) 6 App Cas 251
New Zealand Shipping Co Ltd v Societe des Ateliers et Chantiers de France [1919] AC 1
Trollope & Colls v NW Metropolitan Regional Hospital Board [1973] 1 WLR 601
Secured Income Real Estate (Aust) Ltd v St Martins Investments PL (1979) 144 CLR 596
David Securities PL v Commonwealth Bank of Australia (1992) 175 CLR 516 [2001] HCA 48
Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 [2001] HCA 68
Hookway v Racing Victoria Ltd (2005) 13 VR 444
[2005] VSCA 310
Qld Alumina Ltd v Alinta DQP PL [2007] QCA 387
Leon Holdings Pty Ltd v O’Donnell (2009) 25 VR 569 [2009] VSC 430
Champion Home Sales PL v DCT Projects PL [2015] NSWSC 616
Category: Principal judgment
Parties: Scott Donald Bailey and Catherine Frances Bailey (applicants)
Champion Homes Sales Pty Ltd (respondent)
Representation: Applicant: M Hamwood (Solicitor)
Respondent: Chris Stomo (Counsel)
Solicitors: Mark Hamwood (applicant)
Kedron Legal (respondent)

File Number(s): HB 16/42074
Publication restriction: Nil

REASONS FOR DECISION

The applicant owners and the respondent builder entered into a written home building contract on 20 June 2014 for the construction by the builder of two adjacent homes in Merrylands, New South Wales on land owned by the applicants.
Following practical completion of the homes on 14 March 2016, the male applicant owner complained of numerous defects in construction to the Office of Fair Trading. The respondent builder did not attend a site meeting with an officer from Fair Trading in July 2016 on the basis that the matters were unsuitable for being dealt with at a site meeting as they were contractual issues. In an email 21 July 2016 expressing this view, the managing director of the builder, who was the principal for the builder and gave the primary evidence for the builder in these proceedings, said in respect of one issue “If the owner is not satisfied he should take this matter to NCAT” and in relation to other issues “The owner can refer this to NCAT”.
The applicant owners then filed with NCAT on 16 September 2016. Thereafter the matter has proceeded with the male applicant owner being named as sole applicant. The female applicant owner…

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.

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Details

Case: [2017] NSWCATCD 91
Decision Date: 15 November 2017

CaseChat Overview and Summary

The applicants, Bailey, sought relief against Champion Homes Sales Pty Ltd, the respondent, due to issues arising from a home-building contract. The dispute centred around variations to the contract, the period during which the works were to be completed, and the subsequent failure of consideration and breach of warranty. The case was heard in the Supreme Court of Queensland, where Justice Byrne presided.

The central legal issues before the court were whether there was a variation in the contract that extended the period during which the works were to be completed and, if so, whether this variation was enforceable. Additionally, the court had to determine whether there was a failure of consideration and a breach of warranty, and if so, what remedies were available to the applicants. The court also considered whether the applicants were entitled to restitution and, if so, the appropriate amount.

Justice Byrne held that there was indeed a variation that extended the period during which the works were to be completed, and this variation was enforceable. The court found that there was a failure of consideration and a breach of warranty, entitling the applicants to restitution. The court calculated the appropriate amount of restitution to be $80,433. The judge further determined that the applicants were entitled to costs on the ordinary basis up until a certain date, and on the indemnity basis thereafter.

The final orders of the court were that the respondent was to pay the applicants $80,433 by a specified date, and to pay the applicants’ costs as outlined in the judgment. This decision provides clarity on the enforceability of variations in home-building contracts and the remedies available in cases of failure of consideration and breach of warranty.

Orders

Orders of the court

Respondent to pay applicants $80,433 on or before 22 November 2017.

Respondent to pay applicants’ costs of the proceedings as agreed or assessed on the ordinary basis to and including 4 April 2017 and on the indemnity basis on and from 5 April 2017.

Background

Background to the litigation

Full text does not contain this section.

Evidence

Evidence Before The Court

Full text does not contain this section.

Decision

Reasons for decision

Full text does not contain this section.

Ratio Decidendi

Legal Principle Established

Full text does not contain this section.

Medium Neutral Citation:	Bailey v Champion Homes Sales Pty Ltd [2017] NSWCATCD 91
Hearing dates:	13 & 14 September 2017
Date of orders:	15 November 2017
Decision date:	15 November 2017
Jurisdiction:	Consumer and Commercial Division
Before:	G K Burton SC, FCIArb, Senior Member
Decision:	Respondent to pay applicants $80,433 on or before 22 November 2017. Respondent to pay applicants’ costs of the proceedings as agreed or assessed on the ordinary basis to and including 4 April 2017 and on the indemnity basis on and from 5 April 2017.
Catchwords:	Home building; variations; contract period; works period; restitution; mistake; failure of consideration; breach of warranty; damages
Legislation Cited:	Home Building Act 1989 (NSW) Civil and Administrative Tribunal Act 2013 (NSW)
Cases Cited:	Mackay v Dick (1881) 6 App Cas 251 New Zealand Shipping Co Ltd v Societe des Ateliers et Chantiers de France [1919] AC 1 Trollope & Colls v NW Metropolitan Regional Hospital Board [1973] 1 WLR 601 Secured Income Real Estate (Aust) Ltd v St Martins Investments PL (1979) 144 CLR 596 David Securities PL v Commonwealth Bank of Australia (1992) 175 CLR 516 [2001] HCA 48 Roxborough v Rothmans of Pall Mall Australia Ltd (2001) 208 CLR 516 [2001] HCA 68 Hookway v Racing Victoria Ltd (2005) 13 VR 444 [2005] VSCA 310 Qld Alumina Ltd v Alinta DQP PL [2007] QCA 387 Leon Holdings Pty Ltd v O’Donnell (2009) 25 VR 569 [2009] VSC 430 Champion Home Sales PL v DCT Projects PL [2015] NSWSC 616
Category:	Principal judgment
Parties:	Scott Donald Bailey and Catherine Frances Bailey (applicants) Champion Homes Sales Pty Ltd (respondent)
Representation:	Applicant: M Hamwood (Solicitor) Respondent: Chris Stomo (Counsel) Solicitors: Mark Hamwood (applicant) Kedron Legal (respondent)
File Number(s):	HB 16/42074
Publication restriction:	Nil