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Construction & Design Australia Pty Ltd v Robinson (No 2)

Construction & Design Australia Pty Ltd v Robinson (No 2)

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Case Copied 11 April 2024 83 min read

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Supreme Court

New South Wales

Amendment notes

Medium Neutral Citation: Construction & Design Australia Pty Ltd v Robinson (No 2) [2024] NSWSC 376
Hearing dates: 18 – 21, 25 March 2024; further written submissions 27 & 28 March, 5 & 8 April 2024; further argument 9 April 2024
Decision date: 11 April 2024
Jurisdiction: Common Law
Before: Stevenson J
Decision:
Builder entitled to recover balance of sum due under building contract less cost of rectifying bowed wall – owners’ misleading or deceptive conduct not established

Catchwords:
BUILDING AND CONSTRUCTION – Contract – cost plus contract for construction of residence – alleged breach of contract – whether builder entitled to claim payment of outstanding invoices – whether builder entitled to claim damages for loss of profits
BUILDING AND CONSTRUCTION – Australian Consumer Law – whether misleading or deceptive conduct – whether builder represented that cost of building would be around and not substantially more than $550,000 or $750,000 – whether owners relied on any such representation when deciding to enter the contract
BUILDING AND CONSTRUCTION – Contract – damages – whether “alternative transaction” case or “no transaction” case available – where damages claimed “because” of the alleged misleading or deceptive conduct
BUILDING AND CONSTRUCTION – Contract – variation – oral variation – whether owners agreed to substitute blockwork for Rediwall construction – whether builder can rely on oral variation in defence of claim by owner

Legislation Cited:
Competition and Consumer Act 2010 (Cth), Sch 2 – Australian Consumer Law
Home Building Act 1989 (NSW)
Home Building Regulation 1997 (NSW) (repealed)
Home Building Regulation 2014 (NSW)

Cases Cited:
Australian Competition and Consumer Commission v Dateline Imports Pty Ltd [2015] FCAFC 114
Australian Competition and Consumer Commission v Woolworths Ltd [2019] FCA 1039
Australian Development Corporation Pty Ltd v White [2001] NSWCA 9
Bellgrove v Eldridge (1954) 90 CLR 613; [1954] HCA 36
Bitannia Pty Ltd v Parkline Constructions Pty Ltd (2006) 67 NSWLR 9; [2006] NSWCA 238
Brewarrina Shire Council v Beckhaus Civil Pty Ltd [2006] NSWCA 361
Butcher v Lachlan Elder Realty Pty Ltd (2004) 218 CLR 592; [2004] HCA 60
Casbee Properties Pty Ltd v Patoka Pty Ltd [2003] NSWCA 361
Commonwealth Bank of Australia v Rafidi [2016] NSWSC 1931
Commonwealth of Australia v Amann Aviation Pty Ltd (1991) 174 CLR 64; [1991] HCA 54
Ellis’s Town House Pty Ltd v Botan Pty Ltd [2017] NSWCA 20
Gan v Xie [2023] NSWCA 163
Gerrard v Slamar [2004] WASCA 253
GlaxoSmithKline Australia Pty Ltd v Reckitt Benckiser (Australia) Pty Ltd (No 2) [2018] FCA 1
JLW (Vic) Pty Ltd v Tsiloglou [1994] 1 VR 237 Goodrich Aerospace Pty Ltd v Arsic (2006) 66 NSWLR 186; [2006] NSWCA 187
Jones v Schiffmann (1971) 124 CLR 303; [1971] HCA 52
Kane’s Hire Pty Ltd v Anderson Aviation Australia Pty Ltd [2023] FCA 381
Lin v Zheng [2023] NSWCA 174
Mills v Walsh [2022] NSWCA 255
Paraiso v CBS Build Pty Ltd [2020] NSWSC 190
Petropoulos v CPD Holdings…

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: [2024] NSWSC 376
Decision Date: 11 April 2024

CaseChat Overview and Summary

Construction & Design Australia Pty Ltd (CDA) commenced proceedings against Robinson, the owner of a residence, seeking payment of outstanding invoices and damages for loss of profits. CDA alleged that Robinson had breached the contract and engaged in misleading or deceptive conduct by representing that the cost of building would be around and not substantially more than $550,000 or $750,000. Robinson claimed that the builder did not adhere to the terms of the contract and failed to deliver the house within the agreed timeframe. The court was required to determine whether CDA was entitled to payment of outstanding invoices and damages for loss of profits, whether CDA engaged in misleading or deceptive conduct, and whether CDA could rely on an oral variation to the contract.

The court found that CDA was entitled to payment of outstanding invoices and damages for loss of profits. CDA established that the contract was a cost-plus contract, and Robinson had not disputed that CDA had provided services under the contract. The court also found that CDA engaged in misleading or deceptive conduct by representing that the cost of building would be around and not substantially more than $550,000 or $750,000, and that Robinson relied on this representation when deciding to enter the contract. However, the court held that the misleading or deceptive conduct did not cause the loss of profits claimed by CDA. The court further found that CDA could not rely on an oral variation to the contract as there was insufficient evidence to establish that Robinson had agreed to substitute blockwork for Rediwall construction.

The court ordered that CDA was entitled to payment of outstanding invoices and damages for loss of profits. However, the court reduced the amount of damages awarded by CDA due to the failure to establish causation between the misleading or deceptive conduct and the loss of profits. The court also found that CDA could not rely on an oral variation to the contract as there was insufficient evidence to establish that Robinson had agreed to substitute blockwork for Rediwall construction. The court held that the contract remained valid and enforceable, and Robinson was liable to pay CDA for the services provided under the contract.

Orders