Fraser v Sperling - [2015] VSC 698

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION
JUDICIAL REVIEW & APPEALS LIST

S CI 2014 6044

MAUREEN FRASER and DESMOND THOMAS FRASER	Plaintiffs
v
GUNTRAM SPERLING and HEIDI KASTNER	Defendants

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JUDGE:	Daly AsJ
WHERE HELD:	Melbourne
DATE OF HEARING:	30 September 2015
DATE OF JUDGMENT:	11 December 2015
CASE MAY BE CITED AS:	Fraser and anor v Sperling and anor
MEDIUM NEUTRAL CITATION:	[2015] VSC 698

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JUDICIAL REVIEW AND APPEAL – Appeal from the Victorian Civil and Administrative Tribunal on a question of law – Appeal dismissed - Building contract relied upon by the plaintiffs not in evidence before VCAT, and not established as a valid and enforceable contract – Section 31(2) of the Building Contracts Act 1993 (Vic)

CONTRACT – Domestic building contracts – Lumbers v W Cook Builders Pty Ltd (in liquidation) (2008) 232 CLR 635 considered – Legal obligations of the parties established by the terms of the contract, not the actual commercial arrangements of the parties – Obligations of builder assumed under contract – Building contract not discharged by later agreement.

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APPEARANCES:	Counsel	Solicitors
For the Plaintiffs	Mr L P Wirth	Just Law
For the Defendants	In person

HER HONOUR:

This appeal from the Victorian Civil and Administrative Tribunal (‘VCAT’) concerns, in essence, who ought to bear the financial consequences of a trouble plagued residential development of a number of properties at the Dinner Plain ski resort. The plaintiffs (‘the Frasers’) were the owners of lot S2, Roney Mac Twist, Dinner Plain (‘the land’), one of three lots which were the subject of the redevelopment (‘development project’). However, they are retired people, and it appears that the driving force behind the development project was Mrs Fraser’s son, Michael Atwell. Funding for the purchase of the land and the development project was provided by the National Australia Bank Ltd (‘NAB’). These loans were secured by mortgages over the land and the Frasers’ residential home in Corowa, Victoria.

Mr Atwell was the controller of, among other entities, Snowy Corner Pty Ltd (‘Snowy’). Snowy had purchased two lots adjacent to the land (‘Snowy properties’), with the intention of constructing homes on each of the Snowy properties as part of the development project.

Mr Atwell arranged for the two homes to be constructed on the land to be sold ‘off the plan’, one to his sister and another to a company controlled by him. In late 2010 he met a Mr Demetriou, the director of Modern 1 Design Pty Ltd (‘Modern’), a building company. Apparently not known to Mr Atwell (or the Frasers) at the time, Mr Demetriou was not a registered building practitioner within the meaning of the Domestic Building Contracts Act 1995 (Vic). A building surveyor must not issue a building permit for the construction of any proposed building works without being satisfied that the builder is a registered building practitioner covered by the required insurance under s 24A of the Building Act 1993 (Vic). As such, Modern could…

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 Fraser v Sperling

Details

AGLC: Fraser v Sperling [2015] VSC 698
Case: [2015] VSC 698
Decision Date: 11 December 2015

CaseChat Overview and Summary

The appeal in Fraser v Sperling involved a dispute between the plaintiffs, Fraser and others, and the defendant, Sperling, concerning a building contract for domestic construction. The plaintiffs sought judicial review of a decision by the Victorian Civil and Administrative Tribunal (VCAT). The primary issue was whether VCAT erred in its determination that the plaintiffs had failed to establish a valid and enforceable building contract against the defendant.

The legal issues centred around the existence and enforceability of the building contract. The plaintiffs argued that VCAT should have considered the terms of the contract, even though it was not in evidence. They also contended that their obligations under the contract were discharged by a subsequent agreement with the defendant. The defendant, on the other hand, argued that the contract was not established as a valid and enforceable agreement, and therefore, VCAT was correct in its decision.

The court found that the building contract relied upon by the plaintiffs was not in evidence before VCAT, and the plaintiffs had not established it as a valid and enforceable contract. The court held that section 31(2) of the Building Contracts Act 1993 (Vic) required the plaintiffs to provide evidence of the contract. The court also found that the obligations of the parties were established by the terms of the contract, not the actual commercial arrangements between the parties. The court concluded that the obligations assumed by the builder under the contract were not discharged by the subsequent agreement. The appeal was dismissed.

Orders