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Dierikx v Merrick

Dierikx v Merrick

Case [2021] NSWCATCD 159 17 February 2021

Repudiation & Termination

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Civil and Administrative Tribunal

New South Wales

Medium Neutral Citation: Dierikx v Merrick [2021] NSWCATCD 159
Hearing dates: 18 January 2021
Date of orders: 17 February 2021
Decision date: 17 February 2021
Jurisdiction: Consumer and Commercial Division
Before: Graham Ellis SC, Senior Member
Decision:
1.   The first respondent is to pay the applicants $198,451.38 immediately.
2.   Any application for costs is to be made by written submissions to be filed and served on or before Wednesday 03 March 2021.
3.   Any submissions in response are to be filed and served on or before Wednesday 17 March 2021.
4.   Any submissions made in compliance with order 2 or order 3 are to address the question of whether costs can be considered on the papers, ie without the need for a further hearing.

Catchwords:
BUILDING AND CONSTRUCTION — Contract —Repudiation — Termination — Home Building Act — Statutory warranties — Defence — Failure to mitigate — Assessment of damages

Legislation Cited:
Civil and Administrative Tribunal Act 2013 (NSW)
Civil and Administrative Tribunal Rules 2014 (NSW)
Home Building Act 1989 (NSW)

Cases Cited:
AAD Build Pty Ltd v Garside [2015] NSWWCATCD 7
Air Tahiti Nui Pty Ltd v McKenzie (2009) 77 NSWLR 299
Bellgrove v Eldridge [1954] HCA 36
BH Constructions Pty Ltd v Kapeller [2019] NSWSC 1086
Capello v Hammond & Simonds Pty Ltd [2020] NSWSC 1021
Carr v J A Berriman Pty Ltd [1953] HCA 31
Cohen v Zanzoul trading as Uniq Building Group [2020] NSWSC 592
Galdona v Peacock [2017] NSWCATAP 64
Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117
Goncalves v Bora Developments Pty Ltd [2020] NSWCTAP 9
Government of Japan v Global Air Leasing Pty Ltd [2003] QSC 221
Haines v Bendall [1991] HCA 15
Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015] NSWSC 354
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61
Lederberger v Mediterranean Olives Financial Pty Ltd [2012] VSC 262
Mann v Paterson Constructions Pty Ltd [2019] HCA 32
McDonald v Dennys Lascelles Ltd [1933] HCA 25
Pacorp Holdings Pty Ltd v Waller [2017] NSWCATAP 167
Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154

Texts Cited:
Nil

Category: Principal judgment
Parties: Scott Dierikx Lynda Dierikx (Applicants)
Ty Merrick and Ty Merrick Building Pty Ltd (Respondents)
Representation: Baker Love Lawyers (Applicants)
CDG Law (Respondents)

File Number(s): HB 19/56470
Publication restriction: Nil

REASONS FOR DECISION

Outline

On 09 March 2018 the applicants entered into a fixed sum contract for $268,664 for building work to be done on their property at Glendon Brook which work included a house, carport and shed. That house was a “kit home” from Harkaway Homes.
On 16 December 2019 the applicants lodged an application, primarily alleging defective work. They claimed damages and an order that they were not liable to pay $13,433.20. No cross-application was filed by either of the two respondents.
In these proceedings, the following issues require determination:

Was the applicants’ contract with the first or the second respondent?

Was…

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.

Continue reading Dierikx v Merrick

Details

AGLC: Dierikx v Merrick [2021] NSWCATCD 159
Case: [2021] NSWCATCD 159
Decision Date: 17 February 2021

CaseChat Overview and Summary

The applicants, Dierikx, brought an action against the respondents, Merrick and another, in relation to a contract for the construction of a residential building. The applicants sought damages for breach of contract, failure to comply with statutory warranties, and repudiation. The dispute was heard in the Supreme Court of New South Wales. The central issues before the court were whether the applicants were entitled to damages for the respondents' failure to complete the construction of the house, and if so, what amount was appropriate. Additionally, the court had to determine whether the applicants had mitigated their losses and if the respondents had a valid defence to the claim.

The court found that the respondents had repudiated the contract by failing to complete the construction of the house. The applicants were entitled to damages for the breach of contract. The court also found that the respondents had failed to comply with the statutory warranties under the Home Building Act. However, the applicants had not mitigated their losses as they had not taken reasonable steps to find another contractor to complete the work. The court held that the applicants were entitled to damages, but the amount was reduced by the amount that could have been saved by mitigating their losses. The court assessed the damages based on the cost of completion and other losses suffered by the applicants.

The court ordered that the first respondent pay the applicants $198,451.38 immediately. The court also ordered that any application for costs be made by written submissions, with responses to be filed and served within specified timeframes. The court further ordered that any submissions made in compliance with these orders address the question of whether costs could be considered on the papers, without the need for a further hearing. This decision provides guidance on the assessment of damages in cases where a contractor repudiates a building contract and fails to comply with statutory warranties.

Orders

Orders of the court

1. The first respondent is to pay the applicants $198,451.38 immediately.

2. Any application for costs is to be made by written submissions to be filed and served on or before Wednesday 03 March 2021.

3. Any submissions in response are to be filed and served on or before Wednesday 17 March 2021.

4. Any submissions made in compliance with order 2 or order 3 are to address the question of whether costs can be considered on the papers, ie without the need for a further hearing.

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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Citations

AGLC Citation

Dierikx v Merrick [2021] NSWCATCD 159

Cases citing this decision · 0 of 0 shown

No citing cases yet.

Cases cited in this decision · 16 of 16 shown

Cappello v Hammond & Simonds NSW Pty Ltd
[2020] NSWSC 1021 Para 18

…, in addition to Kapeller , referred to Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154 ( Pethybridge ), Capello v Hammond & Simonds Pty Ltd [2020] NSWSC 1021 ( Capello ), Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015] NSWSC 354 ( HRF ), Lederberger v Mediterranean Olives Financial Pty L…
Cohen v Zanzoul trading as Uniq Building Group
[2020] NSWSC 592 Para 54

…As was noted in the respondents’ written submissions, Cohen v Zanzoul trading as Uniq Building Group [2020] NSWSC 592 at [105] makes it clear that “ repudiation by the promisor does not terminate the obligations under the contract. Determination of the contract only happens when the promisee decides to terminate pe…
Mann v Paterson Constructions Pty Ltd
[2019] HCA 32 Para 43

…ut to relieve them of any obligation for future performance ( McDonald v Dennys Lascelles Ltd [1933] HCA 25 and Mann v Paterson Constructions Pty Ltd [2019] HCA 32), any claim for defective work prior to that termination is not affected but such termination would impact on a claim for incomplete work since the o…
BH Australia Constructions Pty Ltd v Kapeller
[2019] NSWSC 1086 Para 18

…The submissions for the applicants referred to the decisions in BH Constructions Pty Ltd v Kapeller [2019] NSWSC 1086 ( Kapeller ) and AAD Build Pty Ltd v Garside [2015] NSWWCATCD 7 ( Garside ) while the submissions for the respondents, in addition to Kapeller , referred to Pethybridge v Stedikas Holdings Pty Ltd [2…
Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd
[2015] NSWSC 354 Para 18

…A 154 ( Pethybridge ), Capello v Hammond & Simonds Pty Ltd [2020] NSWSC 1021 ( Capello ), Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015] NSWSC 354 ( HRF ), Lederberger v Mediterranean Olives Financial Pty Ltd [2012] VSC 262 ( Lederberger ) and Goncalves v Bora Developments Pty Ltd [2020] NSWCTAP…
APN Funds Management Limited (in its capacity as the responsible entity for the APN Property for Income Fund No.2) v Australian Property Investment Strategic Pty Ltd
[2012] VSC 262 Para 18

…Capello ), Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015] NSWSC 354 ( HRF ), Lederberger v Mediterranean Olives Financial Pty Ltd [2012] VSC 262 ( Lederberger ) and Goncalves v Bora Developments Pty Ltd [2020] NSWCTAP 9 ( Goncalves ). It is noted that a number of those decisions refer to and q…
Air Tahiti Nui Pty Ltd v McKenzie
[2009] NSWCA 429 Para 18

…y Ltd [2020] NSWCTAP 9 ( Goncalves ). It is noted that a number of those decisions refer to and quote passages from Air Tahiti Nui Pty Ltd v McKenzie (2009) 77 NSWLR 299 ( Air Tahiti ).…
Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd
[2007] HCA 61 Para 32

…cant breach of an intermediate term or (3) repudiation of the contract by the other party: Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61.…
Pethybridge v Stedikas Holdings Pty Ltd
[2007] NSWCA 154 Para 18

…015] NSWWCATCD 7 ( Garside ) while the submissions for the respondents, in addition to Kapeller , referred to Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154 ( Pethybridge ), Capello v Hammond & Simonds Pty Ltd [2020] NSWSC 1021 ( Capello ), Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015…
Govt of Japan v Global Air Leasing P/L
[2003] QSC 221 Para 41

…An election whether to affirm a contract or terminate it cannot be unreasonably delayed: Government of Japan v Global Air Leasing Pty Ltd [2003] QSC 221. In this case the purported election to terminate the contract was well after any reasonable period for the builder to make an election whether to continue with…
Haines v Bendall
[1991] HCA 15 Para 11

…es entitles the owner to make a claim for damages. When measuring damages, the fundamental principle, as stated by the High Court in Haines v Bendall [1991] HCA 15, is that “ the injured party should receive compensation in a sum which, so far as money can do, will put that party in the same position as he or sh…
Bellgrove v Eldridge
[1954] HCA 36 Para 11

…iple is subject to the qualification that both the method of rectification and the cost of rectification must be reasonable: Bellgrove v Eldridge [1954] HCA 36.…
Carr v JA Berriman Pty Ltd
[1953] HCA 31 Para 36

…ed from conduct which is consistent only with the continued existence of the contract, such as its continued performance: Carr v J A Berriman Pty Ltd [1953] HCA 31. In this case, it is clear that the first respondent was never excluded from the site by the applicants and that, by continuing with the building wor…
McDonald v Dennys Lascelles Ltd
[1933] HCA 25 Para 43

…ligations of the parties up to the date of termination but to relieve them of any obligation for future performance ( McDonald v Dennys Lascelles Ltd [1933] HCA 25 and Mann v Paterson Constructions Pty Ltd [2019] HCA 32), any claim for defective work prior to that termination is not affected but such termination…
This case also raises a difficulty in relation to the assessment of damages. Gallagher v Masters Installation Pty Ltd
[2017] NSWCATAP 117 Para 125

…rts on this issue and the absence of submissions addressing quantum. However, it is clear from cases such as Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117; Pacorp Holdings Pty Ltd v Waller [2017] NSWCATAP 167 that, where precision is not possible, the Tribunal must do the best it can with the available…
Tribunal must do the best it can, based on the evidence that is available. Pacorp Holdings Pty Ltd v Waller
[2017] NSWCATAP 167 Para 125

…ssing quantum. However, it is clear from cases such as Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117; Pacorp Holdings Pty Ltd v Waller [2017] NSWCATAP 167 that, where precision is not possible, the Tribunal must do the best it can with the available evidence.…

Legislation cited in this decision · 4

Civil and Administrative Tribunal Act 2013 (NSW)
1 mention (from Para 174)
Civil and Administrative Tribunal Rules 2014 (NSW)
1 mention (from Para 175)
Environment Planning and Assessment Act 1979 (NSW)
1 mention (from Para 62)
Home Building Act 1989 (NSW)
1 mention (from Para 5)

Medium Neutral Citation:	Dierikx v Merrick [2021] NSWCATCD 159
Hearing dates:	18 January 2021
Date of orders:	17 February 2021
Decision date:	17 February 2021
Jurisdiction:	Consumer and Commercial Division
Before:	Graham Ellis SC, Senior Member
Decision:	1. The first respondent is to pay the applicants $198,451.38 immediately. 2. Any application for costs is to be made by written submissions to be filed and served on or before Wednesday 03 March 2021. 3. Any submissions in response are to be filed and served on or before Wednesday 17 March 2021. 4. Any submissions made in compliance with order 2 or order 3 are to address the question of whether costs can be considered on the papers, ie without the need for a further hearing.
Catchwords:	BUILDING AND CONSTRUCTION — Contract —Repudiation — Termination — Home Building Act — Statutory warranties — Defence — Failure to mitigate — Assessment of damages
Legislation Cited:	Civil and Administrative Tribunal Act 2013 (NSW) Civil and Administrative Tribunal Rules 2014 (NSW) Home Building Act 1989 (NSW)
Cases Cited:	AAD Build Pty Ltd v Garside [2015] NSWWCATCD 7 Air Tahiti Nui Pty Ltd v McKenzie (2009) 77 NSWLR 299 Bellgrove v Eldridge [1954] HCA 36 BH Constructions Pty Ltd v Kapeller [2019] NSWSC 1086 Capello v Hammond & Simonds Pty Ltd [2020] NSWSC 1021 Carr v J A Berriman Pty Ltd [1953] HCA 31 Cohen v Zanzoul trading as Uniq Building Group [2020] NSWSC 592 Galdona v Peacock [2017] NSWCATAP 64 Gallagher v Masters Installation Pty Ltd [2017] NSWCATAP 117 Goncalves v Bora Developments Pty Ltd [2020] NSWCTAP 9 Government of Japan v Global Air Leasing Pty Ltd [2003] QSC 221 Haines v Bendall [1991] HCA 15 Harold R Finger & Co Pty Ltd v Karellas Investments Pty Ltd [2015] NSWSC 354 Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd [2007] HCA 61 Lederberger v Mediterranean Olives Financial Pty Ltd [2012] VSC 262 Mann v Paterson Constructions Pty Ltd [2019] HCA 32 McDonald v Dennys Lascelles Ltd [1933] HCA 25 Pacorp Holdings Pty Ltd v Waller [2017] NSWCATAP 167 Pethybridge v Stedikas Holdings Pty Ltd [2007] NSWCA 154
Texts Cited:	Nil
Category:	Principal judgment
Parties:	Scott Dierikx Lynda Dierikx (Applicants) Ty Merrick and Ty Merrick Building Pty Ltd (Respondents)
Representation:	Baker Love Lawyers (Applicants) CDG Law (Respondents)
File Number(s):	HB 19/56470
Publication restriction:	Nil