Cerda v Jacob

Cerda v Jacob involved a dispute between a builder, Juan Pablo Larrain Cerda, and a homeowner, Binny Jacob. The case arose from a building contract that Cerda entered into with Jacob for the construction of retaining walls and external block stairs at Jacob's property. The primary dispute centred on the quality of the construction work, with Jacob alleging that Cerda had breached the contract by constructing the walls and stairs in a substandard manner. Jacob sought damages for the costs of remediation and completion of the works. The Queensland Civil and Administrative Tribunal (QCAT) originally found in Jacob's favour, ordering Cerda to pay damages for the remediation and completion of the building works. Cerda appealed this decision to the Queensland Court of Appeal.

The appeal raised several significant legal issues, including whether the contract between Cerda and Jacob was valid and enforceable, and if so, whether Cerda had breached it. Additionally, the court needed to determine the appropriate measure of damages for the breach, considering whether the costs for the remediation and completion of the works were reasonable and necessary. The appeal also addressed whether there were any errors in the tribunal's assessment of the evidence and whether the tribunal had correctly applied the law in reaching its decision.

The Court of Appeal found that the contract between Cerda and Jacob was void because it did not comply with the requirements of the Queensland Building and Construction Commission Act 1991. Consequently, the contract was of no effect, and the parties' rights had to be determined under the Civil Liability Act 2003 and the relevant principles of breach of duty and restitution. The court identified errors in the tribunal's reasoning, particularly in its acceptance of certain evidence and its calculation of damages. The appeal court held that the tribunal had erred in law and in fact by proceeding on the basis that the contract was valid and enforceable.

The Court of Appeal allowed the appeal, set aside the tribunal's decision regarding the amount of damages payable, and ordered Cerda to pay Jacob $6,750.00 within 28 days of the decision. Additionally, Cerda was ordered to pay Jacob's costs of proceeding in the amount of $750.70 within the same timeframe. The counter application was dismissed.