DESHMUKH and DISTINCTIVE BUILDING SERVICES PTY LTD

The applicants, Deshmukh and Distinctive Building Services Pty Ltd, brought an action against a builder for breach of a home building work contract. The applicants sought compensation for rent paid for residential accommodation due to delays in the completion of their dwelling. The matter was heard in the Supreme Court of Victoria. The builder argued that the applicants' claim for compensation included costs that were not directly caused by the delay in completion, such as water charges, local government rates, and interest on the applicants' loan. The central legal issue was whether these additional costs were recoverable under the home building work contract remedy for compensation for rent paid by owners due to delay in completion of dwelling.

The court held that the water charges, local government rates, and interest on the applicants' loan were not a loss caused by the builder's breach of contract. The court reasoned that these costs were not directly attributable to the delay in completion of the dwelling and, therefore, were not recoverable under the home building work contract remedy. The builder was not liable for these additional costs. The court found that the applicants were only entitled to compensation for the actual rent paid for residential accommodation due to the delay in completion. The builder's liability was limited to the direct costs incurred by the applicants as a result of the delay.

The court ordered the builder to pay compensation to the applicants for the rent paid for residential accommodation due to the delay in completion of the dwelling. The court further ordered the builder to pay the applicants' costs of the proceeding. The builder was not required to pay any compensation for water charges, local government rates, or interest on the applicants' loan.