Fair Trading Administration Corporation v Sleigh

The Fair Trading Administration Corporation (the Corporation) appealed to the Court of Appeal of New South Wales against a decision of the District Court. The dispute concerned the Corporation's entitlement to recover from a builder for "bad workmanship" in residential building work, notwithstanding that the building owner was unable to recover from the builder themselves.

The central legal issue before the Court of Appeal was the proper construction and operation of section 98(1) of the *Building Services Corporation Act 1989* (NSW). Specifically, the court had to determine whether this provision permitted the Corporation to recover from a builder for defective work when the building owner, for reasons such as the expiry of a limitation period, could not pursue their own claim against the builder.

The Court of Appeal, in allowing the appeal, reasoned that section 98(1) of the Act was intended to provide a mechanism for the Corporation to recover from builders in circumstances where the builder's defective work had caused loss, even if the owner's direct claim was barred. The court interpreted the statutory language to mean that the Corporation's right to recover was not contingent upon the owner's ability to sue the builder at the time the Corporation sought recovery. The court found that the District Court had erred in dismissing the Corporation's action.

Consequently, the Court of Appeal allowed the appeal with costs, set aside the judgment of the District Court, and dismissed the respondent builder's application to dismiss the appellant Corporation's action, also with costs.