Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402) v The Secretary of the Department of Customer Service

[2024] NSWLEC 1629

Land and Environment Court

New South Wales

Medium Neutral Citation:

Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402) v The Secretary of the Department of Customer Service [2024] NSWLEC 1629

Hearing dates:

Conciliation Conference 4 July, 2 August, 2 September 2024

Date of orders:

09 October 2024

Decision date:

09 October 2024

Jurisdiction:

Class 2

Before:

Targett C

Decision:

The Court orders that:

(1) The appeal is upheld.

(2) In respect of the building work rectification orders out in the instrument, being Building Work Rectification Order (Ref 10680677) dated 1 December 2023 and varied on 22 December 2023, issued by the Secretary of the Department of Customer Service to Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402), in respect of the property located at 2-24 Mitchell Road, Alexandria NSW 2015 (Lot 1 DP 669038, Lot 100 DP 1031123, SP 101237):

(a) Pursuant to s 49(3)(a) of the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (RAB Act), Item 3 is revoked; and

(b) Pursuant to s 49(3)(c) of the RAB Act, Items 1-2, 4-16 are substituted for the orders set out in Annexure A.

(3) Liberty to apply to the Court is granted on giving 3 days’ notice.

(1) The appeal is upheld.

(2) In respect of the building work rectification orders out in the instrument, being Building Work Rectification Order (Ref 10680677) dated 1 December 2023 and varied on 22 December 2023, issued by the Secretary of the Department of Customer Service to Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402), in respect of the property located at 2-24 Mitchell Road, Alexandria NSW 2015 (Lot 1 DP 669038, Lot 100 DP 1031123, SP 101237):

(i) Pursuant to s 49(3)(a) of the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (RAB Act), Item 3 is revoked; and

(ii) Pursuant to s 49(3)(c) of the RAB Act, Items 1-2, 4-16 are substituted for the orders set out in Annexure A.

(3) Liberty to apply to the Court is granted on giving 3 days’ notice.

Catchwords:

BUILDING WORK RECTIFICATION ORDER – conciliation conference – agreement between the parties – orders

Legislation Cited:

Land and Environment Court Act 1979, ss 18, 34, 39

Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020, ss 33, 38, 49

Cases Cited:

Eunomia Developments Pty Ltd v Secretary of the Department of Customer Service [2021] NSWLEC 1279

Phillips v Walsh (1990) 20 NSWLR 206

Category:

Principal judgment

Parties:

Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402) (Applicant)
The Secretary of the Department of Customer Service (Respondent)

Representation:

Counsel:
C Novak (Applicant)
I Lacy (Solicitor) (Respondent)

Solicitors:
Bartier Perry Lawyers (Applicant)
Department of Customer Service (Respondent)

File Number(s):

2023/463895

Publication restriction:

Nil

Judgment

1. COMMISSIONER: These proceedings concern an appeal pursuant to s 49(1) of the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (RAB Act) against the Building Works Rectification Order (BWRO) issued by the respondent on 1 December 2023 under s 33 of the RAB Act, requiring the applicants to carry out rectification works primarily relating to waterproofing, fire safety and concrete slab integrity at a residential apartment building at 2-24 Mitchell Road, Alexandria (Lot 1 DP 669038, Lot 100 DP 1031123, SP 101237) (Premises).

2. The Court has power to dispose of these proceedings under its Class 2 jurisdiction pursuant to s 18(l) of the Land and Environment Court Act 1979 (LEC Act).

Background

3. On 1 November 2023, the respondent issued the applicant with a notice of intention to issue the BWRO.

4. The BWRO was issued by the respondent on 1 December 2023 pursuant to s 33 of the RAB Act and modified on 22 December 2023 (as permitted by s 38 of the RAB Act).

5. On 21 December 2023, the applicant commenced these proceedings, being within the time period specified in s 49(2) of the RAB Act.

6. The Court arranged a conciliation conference under s 34(1) of the LEC Act between the parties which was held on 4 July 2024, and adjourned on multiple occasions. I presided over the conciliation conference.

7. During the course of the conciliation process, the parties reached agreement as to the terms of a decision in the proceedings that would be acceptable to the parties. The decision agreed upon involves revoking item three (Item 3) in the BWRO and otherwise substituting the BWRO with a different order that provides additional time for works to be carried out (Substituted Order).

8. The parties provided a signed s 34 agreement and supporting jurisdictional statement on 20 September 2024.

Jurisdictional considerations

9. To make orders in accordance with the parties’ agreement, I must be satisfied that the decision to make orders revoking Item 3 and otherwise substituting the BWRO is a decision that the Court can make in the proper exercise of its functions (being the test applied by s 34(3) of the LEC Act). In making the orders to give effect to the agreement between the parties, I was not required to, and have not, made any merit assessment of the issues that were originally in dispute between the parties.

10. Section 39 of the LEC Act relevantly provides the Court with all the functions and discretions of the respondent when determining an appeal of the respondent’s decision. In addition, s 49(3) of the RAB Act gives the Court broad powers on an appeal against a building work rectification order, as follows:

(3) On hearing an appeal, the Court may—

(a)  revoke the building work rectification order, or

(b)  modify the building work rectification order, or

(c)  substitute for the building work rectification order any other order that the Secretary could have given, or

(d)  find that the building work rectification order is sufficiently complied with, or

(e)  make any order with respect to compliance with the building work rectification order as the Court thinks fit, or

(f)  make any other order with respect to the building work rectification order as the Court thinks fit.

11. It is clear that the Court has power to revoke a building work rectification order which would encompass the revocation of Item 3 (s 49(3)(a) of the RAB Act) and to substitute a building work rectification order (s 49(3)(c) of the RAB Act).

12. I am satisfied Item 3 of the BWRO should be revoked and the BWRO otherwise substituted with the Substituted Order in the manner proposed by the parties on the basis that:

1. The applicant is the “developer” for the purposes of s 33(1) of the RAB Act and was able to be issued with the original BWRO and can similarly be issued with the Substituted BWRO.

2. The original BWRO and Substituted Order relate to “building work” for the purposes of s 33(1) of the RAB Act and the parties agree that the “building work” identified in the original BWRO (with the exception of Item 3) and the Substituted Order constitute “serious defects”. The Substituted Order primarily requires the applicant to carry out the works the subject of the original BWRO relating to identified actual or potential serious defects (with the exception of Item 3) but provides additional time for these works to be carried out. The Substituted Order is therefore in accordance with s 33 of the RAB Act.

3. The parties agree that Item 3 relating to an absence of, and subsequent requirement to install, pressure gauges on the internal fire hydrants does not constitute a defect as the works onsite have been constructed in accordance with the deemed to satisfy provisions of the relevant standards. It is therefore appropriate that Item 3 be revoked.

4. The grant of liberty to apply is appropriate in circumstances where the applicant is not in control or occupation of the Premises and compliance with the Substituted Order could be hindered by the applicant obtaining access to carry out the works the subject of the Substituted Order. To this end, I note the comments of Gray C in Eunomia Developments Pty Ltd v Secretary of the Department of Customer Service [2021] NSWLEC 1279 at [7] relating to the same Premises, with reference to the decision of McLelland J in Phillips v Walsh (1990) 20 NSWLR 206 at 210.

Conclusion

13. As the parties’ decision is a decision that the Court could have made in the proper exercise of its functions, I am required under s 34(3) of the LEC Act to dispose of the proceedings in accordance with the parties’ decision.

Orders

14. The Court orders that:

1. The appeal is upheld.

2. In respect of the building work rectification orders out in the instrument, being Building Work Rectification Order (Ref 10680677) dated 1 December 2023 and varied on 22 December 2023, issued by the Secretary of the Department of Customer Service to Eunomia Developments Pty Ltd (ACN 605 617 150) ATF Eunomia Developments Unit Trust (ABN 94 911 587 402), in respect of the property located at 2-24 Mitchell Road, Alexandria NSW 2015 (Lot 1 DP 669038, Lot 100 DP 1031123, SP 101237):

1. pursuant to s 49(3)(a) of the Residential Apartment Buildings (Compliance and Enforcement Powers) Act 2020 (RAB Act), Item 3 is revoked; and

2. pursuant to s 49(3)(c) of the RAB Act, Items 1-2, 4-16 are substituted for the orders set out in Annexure A.

3. (3) Liberty to apply to the Court is granted on giving 3 days’ notice.

N Targett

Commissioner of the Court 

Annexure A

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