Fotedar v Francis
[2014] NSWCATCD 182
•01 October 2014
NSW Civil and Administrative Tribunal
New South Wales
Medium Neutral Citation: Fotedar v Francis [2014] NSWCATCD 182 Hearing dates: 26 August 2014 Decision date: 01 October 2014 Before: P. Boyce, General Member Decision: The application is dismissed.
Catchwords: Jurisdiction Legislation Cited: Home Building Act 1989 Cases Cited: None Texts Cited: None Category: Principal judgment Parties: Sandeep Fotedar (applicant)
Chalita Francis (respondent)File Number(s): HB 14/03362 Publication restriction: None
reasons for decision
Application
This is an application for orders by a home owner ("owner") against an owner builder ("builder") of a residential dwelling for alleged breach of the statutory warranty contained in s 18B of the Home Building Act 1989.
It is for the Tribunal to determine the preliminary issue of jurisdiction before the substantive matter can proceed to determination.
Background
In 2004 on the application of the builders' wife, Holroyd City Council granted development approval to the builder to erect a two story duplex residence on land at 48 ********* Street, Wentworthville owned by the builder.
In about February 2005 Holroyd City Council gave the builder building approval to commence the approved building works.
On or about 20 September 2005 the builder was issued with an owner builders permit to carry out the building work.
On the builders submission the building works commenced about June 2005.
The date of the completion of the building works is a matter of contention between the builder and the owner. Critically, it is a matter for the Tribunal to determine on the evidence before it so that it can consider whether the owner's application has been brought within the time permitted under the Home Building Act.
Standing
Before consideration of the jurisdictional time limits, the standing of the owner must be determined.
It is the owner's evidence that he and his wife entered into a contract for the purchase of the dwelling known as 48 ********Street, Wentworthville ("48") on 23 December 2011. The contract was completed on or about 29 March 2012.
The contract shows the owner and his wife as purchasers and ****** Pty Ltd as vendor.
The builder's evidence is that he agreed to build the duplex and after it was built on his land, the land would be subdivided and he would retain 48A ********* Street, Wentworthville ("48A") and his brother in law would acquire 48.
The owner's evidence shows that the Registrar General registered a plan of subdivision of land with the registered proprietor as Chalita Francis (the builder) on 27 August 2008 creating two lots known as 48 and 48A.
Although there is no evidence of the transfer before the Tribunal, it appears that the builder transferred 48 to a company *******Pty Ltd, of which the builder's brother in law was a director between 27 August 2008 and the completion of the sale of 48 to the owner and his wife on or about 29 March 2012.
To have standing to bring an application to the Tribunal the applicant in proceedings must fall within the class of persons the Act grants such standing to.
S 18C of the Act provides:
18C Warranties as to work by others
(1) A person who is the immediate successor in title to an owner-builder, a holder of a contractor licence, a former holder or a developer who has done residential building work on land is entitled to the benefit of the statutory warranties as if the owner-builder, holder, former holder or developer were required to hold a contractor licence and had done the work under a contract with that successor in title to do the work.
(2) For the purposes of this section, residential building work done on behalf of a developer is taken to have been done by the developer.
S 18D of the Act provides:
18D Extension of statutory warranties
(1) A person who is a successor in title to a person entitled to the benefit of a statutory warranty under this Act is entitled to the same rights as the person's predecessor in title in respect of the statutory warranty.
(1A) A person who is a non-contracting owner in relation to a contract to do residential building work on land is entitled (and is taken to have always been entitled) to the same rights as those that a party to the contract has in respect of a statutory warranty.
(1B) Subject to the regulations, a party to a contract has no right to enforce a statutory warranty in proceedings in relation to a deficiency in work or materials if the warranty has already been enforced in relation to that particular deficiency by a non-contracting owner.
(2) This section does not give a successor in title or non-contracting owner of land any right to enforce a statutory warranty in proceedings in relation to a deficiency in work or materials if the warranty has already been enforced in relation to that particular deficiency, except as provided by the regulations.
On the evidence before the Tribunal, the Tribunal is satisfied that *******Pty Ltd was the entity entitled to the benefit of the statutory warranty under the Act, as it was the successor in title to the owner builder. Further the owner is the successor in title to the person entitled to the benefit of the statutory warranty under the Act and is therefore pursuant to s 18D entitled to the same rights as their predecessor in title. The owner has standing.
Time for bringing claim
The period in which a claim on a statutory warranty could be brought is prescribed by s 18E of the Act for contract made on or before 1 February 2012 as follows:
18E Proceedings for breach of warranties
(1) Proceedings for a breach of a statutory warranty must be commenced within 7 years after:
(a) the completion of the work to which it relates, or
(b) if the work is not completed:
(i) the date of completion of the work specified or determined in accordance with the contract, or
(c) if there is no such date, the date of the contract
It is common ground between the parties that the warranty period as referred to in S 18E is applicable to the owner's claim.
S 3B of the Act sets out the provisions for the date of completion of residential building work as follows:
3B Date of completion of residential building work
(1) The completion of residential building work occurs on the date that the work is complete within the meaning of the contract under which the work was done.
(2) If the contract does not provide for when work is complete (or there is no contract), the completion of residential building work occurs on "practical completion" of the work, which is when the work is completed except for any omissions or defects that do not prevent the work from being reasonably capable of being used for its intended purpose.
(3) It is to be presumed (unless an earlier date for practical completion can be established) that practical completion of residential building work occurred on the earliest of whichever of the following dates can be established for the work:
(a) the date on which the contractor handed over possession of the work to the owner,
(b) the date on which the contractor last attended the site to carry out work (other than work to remedy any defect that does not affect practical completion),
(c) the date of issue of an occupation certificate under the Environmental Planning and Assessment Act1979 that authorises commencement of the use or occupation of the work,
(d) (in the case of owner-builder work) the date that is 18 months after the issue of the owner-builder permit for the work.
(4) If residential building work comprises the construction of 2 or more buildings each of which is reasonably capable of being used and occupied separately, practical completion of the individual buildings can occur at different times (so that practical completion of any one building does not require practical completion of all the buildings).
(5) This section applies for the purposes of determining when completion of residential building work occurs for the purposes of any provision of this Act, the regulations or a contract of home warranty insurance.
The building works were carried out by an owner builder without a contract. As such, s 3B (1) does not apply.
In the absence of a contract providing for when building work is complete, s 3B (2) provides that completion of residential building work occurs on "practical completion". That is defined as being when the work is completed and is reasonably capable of being used for its intended purpose. That is, in the matter before the Tribunal when the building is capable of being used as a dwelling.
S 3B(3) sets out the criteria for presumption of the date on which practical completion occurred.
If the provisions of s 3B(3) in relation to owner builders could be relied upon then, on 20 September 2005 the builder was issued with an owner builder's permit. That is, the statutory warranty period of 7 years commenced 18 months after the date of issue. That is, it commenced on 19 March 2007 and ended on 18 March 2014.
Unless an earlier date of practical completion can be established by the builder, then the limitation period ends on 18 March 2014.
The owner relies on the issue of the owner builders permit to benchmark the start of time period in which to bring his claim.
The builder disputes this assertion and relies on the practical completion of 48 which he says happened in November 2006.
The owner further submits that invoices it has produced establish the date of practical completion not occurring until after January 2007 they are as follows:
Date
Provider
Item
16 February 2007
Gaf Tech Pty Ltd
Attaching to 48 and 48A and energising main electricity switchs
14 March 2007
Multi Purposes Electrical Services Pty Ltd
Certification of smoke detectors installed
14 March 2007
Multi Purposes Electrical Services Pty Ltd
Certification of installation of electrical works
13 June 2007
Dowell Windows and Doors
Glazing Certification
12 February 2007
Elka Wardrobe & Shower Screens
Safety glass certification for shower screens
The owner further relies on the Building Inspection reports carried out by Holroyd City Council as follows:
Date
Result
13 December 2006
Identifies outstanding issues with building including providing certificates from trades and suppliers
21 March 2007
Identifies need for compliance with conditions of approval (ie Statutory declaration from neighbours), minor matter of construction
I May 2007
Similar to above
9 July 2007
Advice that all works completed
8 June 2007
Request for glazing certificate
26 July 2007
Occupation Certificate Issues
It is the builder's evidence that the report of Brian Sturrock Pty Limited in 2006 for 48 establishes that the building was inspected for the purposes of the Residential Home Owners Builder's Warranty Certificate of Insurance.
That report states that the building was inspected on 23 November 2006 and describes the building works to have been completed in respect of 48 in November 2006.
The Insurer issued its certificate for the Home Owners Warranty Insurance based on that report.
The builder also relies on copies of quote/invoices tendered for carpet supplied and installed dated 7 September 2006, quote for supply of blinds dated 16 November 2006 and a quote for kitchen cabinetry dated 12 May 2006.
The owner agitates for the Tribunal to make a finding of when practical completion takes place not earlier than January 2007.
Before considering the evidence adduced, the Tribunal notes that the material placed before it includes material also relevant to the satisfaction of Holroyd City Council's conditions of approval for the subdivision of the land into two lots as referred to in the paragraphs under heading Background. That material is blended with the material in relation to the building work.
The applicant owner bears the onus of proof to establish the date of practical completion.
The certificates that the owner relies on to support his contention that practical completion took place after January 2007 appear to be certificates issued by various suppliers to satisfy the builder's attempts to obtain an occupation certificate. The dates of those certificates follow the outstanding issues identified by the Council inspection of 13 December 2006 and following. Some of those certificates would be needed to satisfy the conditions of approval of the subdivision.
On the evidence before it, the Tribunal is not satisfied that those certificates have bearing on the date of practical completion. The Tribunal is not satisfied that the owner has established the date of practical completion to be other than is asserted by the builder.
The builder has adduced evidence in the form of a report used to support his request for the issue of the Home Owners Warranty Insurance. That report clearly identifies that the building works were completed in regard to 48 in November 2006.
The effect of s 3B(2) is that completion is when practical completion is achieved as defined by the section.
The Tribunal finds on the civil standard of proof that the evidence before it that 48 was practically completed in November 2006.
Having found the date of practical completion to have been in November 2006, the owners claim should have been brought before November 2013, that being 7 years after the date of practical completion.
The applicant owner filed his application for orders on 18 January 2014.
Accordingly, the Tribunal finds that the applicant has filed his claim against the builder out of time and the Tribunal has therefore no jurisdiction to hear and determine the matter.
The application is dismissed.
Philip Boyce
Senior Member
Civil and Administrative Tribunal of New South Wales
1 October 2014
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.
Registrar
Decision last updated: 26 November 2014
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