Jones v Gujjar Construction Pty Ltd

Case •

[2025] NSWCATCD 26

•

01 May 2025

No judgment structure available for this case.

Civil and Administrative Tribunal


New South Wales

Medium Neutral Citation: Jones v Gujjar Construction Pty Ltd [2025] NSWCATCD 26
Hearing dates: 4 February 2025
Submissions 11 February 2025, 14 March 2025 and 26 March 2025
Date of orders: 01 May 2025
Decision date: 01 May 2025
Jurisdiction:Consumer and Commercial Division
Before: R. Alkadamani, Senior Member
Decision:

(1)   Dismiss the respondent’s Adjournment Request filed 3 February 2025.

(2)   Grant leave for the respondent to be legally represented by Mofazzal Haque Kazi of Kazi & Associates, solicitors.

(3)   Order that Luke Matthew Jones be joined as the second applicant.

(4)   Grant leave for the applicants to be legally represented by Benjamin Barrak of Barrak Lawyers.

(5)   Extend the time for the respondent to file submissions in reply to 26 March 2025.

(6)   Vacate orders 1 and 2 of the orders dated 8 July 2024.

(7)   Order the respondent to pay the applicants $135,608.88 within 14 days.

(8) Order pursuant to pursuant to s 48O(1)(c)(ii) of the Home Building Act 1989 (NSW) that that the respondent deliver to the applicants any of the certificates or documents referred to in paragraph [141] of these reasons to the extent that those certificates or documents are in the possession of the builder and are referrable to work for which the applicants have paid the builder.

(9) Order pursuant to pursuant to s 48O(1)(c)(ii) of the Home Building Act 1989 (NSW) that that the respondent deliver to the applicants any warranties or items referred to in paragraph [143] of these reasons to the extent that those warranties or items are in the possession of the builder and are referrable to work for which the applicants have paid the builder.

(10) Order the respondent to pay the applicants’ costs on the ordinary basis, as agreed or assessed.

Catchwords:

HOME BUILDING – defects – non-compliance with work order – contract on foot – renewal proceedings

Legislation Cited:

Civil and Administrative Tribunal Act (2013) NSW

Civil and Administrative Tribunal Rules (2014) NSW

Home Building Act (1989) NSW

Cases Cited:

Baxter Global Investments Pty Ltd v Macro (No 2) [2020] NSWSC 1487

Blessed Sydney Constructions Pty Ltd b Vasudevan [2018] NSWCATAP 98

Bondarek v NSW Land and Housing Corporation [2018] NSWCATAP 299

Brewarrina Shire Council v Beckhaus Civil Pty Ltd [2005] NSWCA 248

Culina v Timilty Constructins Pty Ltd [2022] NSWCATCD 109

Khan v Kang [2014] NSWCATAP 48

Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd [2017] NSWCA 171

Texts Cited:

None

Category:Principal judgment
Parties: Allison Jones (First Applicant)
Luke Matthew Jones (Second Applicant)
Gujjar Construction Pty Ltd (Respondent)
Representation: Solicitors:
Barrak Lawyers (Applicants)
Kazi & Associates (Respondent)
File Number(s): 2024/00032781
Publication restriction: None

REASONS FOR DECISION

  1. On 12 October 2021 Ms Jones and Mr Jones (the owners) entered into a written building contract (the Contract) with Gujjar Construction Pty Ltd ACN 615 644 721 trading as Elante Homes (the builder) for the construction of a residential dwelling on their land at **** Box Hill, NSW, 2765 (the Property).

  2. The parties fell into dispute and on 26 January 2024 Ms Jones commenced proceedings in the Tribunal. Mr Jones was not a party when the proceedings were commenced.

  3. On 8 July 2024 the matter was heard by the Tribunal and orders were made, including a consent work order. Pursuant to the work order, the time for completion of the work was 26 August 2024.

  4. The owners say that the builder did not comply with the work order. Consequently, on 13 September 2024 Ms Jones filed renewal proceedings.

  5. On 16 October 2024 the Tribunal made orders for the exchange and filing of evidence. The owners complied with those orders. The builder did not comply with the orders, and in fact did not file any evidence prior to the hearing date of the renewal proceedings.

  6. On 25 November 2024 the Tribunal issued a notice of hearing advising the parties that hearing of the renewal proceedings was listed on 4 February 2025.

  7. On 3 February 2025 the builder filed an application for an adjournment and included an affidavit in support from its solicitor, Mr Kazi.

  8. The application for an adjournment was made by Mr Kazi at the hearing. The builder relied on the fact that it had only recently retained Mr Kazi, that it needed time to retain counsel and that it needed to obtain an expert report. The builder said that it sought an adjournment for a period of about 2 weeks.

  9. The adjournment request was opposed.

  10. I did not accede to the adjournment request. The grounds on which the builder relied were entirely within its control and should have been dealt with by the builder earlier. In terms of evidence, the Tribunal’s 16 October 2024 orders made a timetable so that each party had an opportunity to obtain the evidence on which it intended to rely. In terms of the builder’s decision as to the timing of retaining legal representation, this was again entirely within the builder’s control. Further, there was no cogent explanation as to why the builder had waited until shortly prior to the hearing on 4 February 2025 to raise these matters and file a request for an adjournment.

  11. I accept that there would be prejudice to the builder by proceeding on 4 February 2025. However, I considered that prejudice was outweighed by the prejudice to the owners of further delay in resolution of this dispute.

  12. Although the builder sought an adjournment of only about 2 weeks, the manner in which matters are listed by the Tribunal would most likely have resulted in delays of months. As at 4 February 2025 matters had been fixed for hearing until at least 31 March 2025. Consequently, this matter would need to be allocated a new hearing date in the ordinary course and it would not simply be allocated another date 14 days after 4 February 2025.

  13. In addition, acceding to the adjournment application would have inevitable wasted finite community resources.

  14. Consequently, in balancing the above matters I refused the builder’s application for an adjournment.

  15. The builder sought leave to permit Mr Kazi to represent it at the hearing. Ms Jones opposed the grant of leave. I granted leave due to the complexity and size of the claim.

  16. In these proceedings Ms Jones was initially the sole applicant even though Mr Jones is also a party to the Contract. At the hearing on 4 February 2025, Mr Jones was joined as the second applicant. The joinder of Mr Jones was not opposed by the builder.

  17. After the hearing on 4 February 2025 directions were made for the filing of submissions. At this point the owners retained Mr Barrak of Barrak Lawyers to prepare their submissions. On 11 February 2025, in accordance with the Tribunal’s directions, the owners filed written submissions prepared by Mr Barrak.

  18. The builder sought an extension of time to 18 February 2025 for its submissions. The owners opposed the extension of time. I granted the request for an extension of time because it was a small delay and would not materially delay the decision. The builder filed its submissions on 18 February 2025.

  19. On 18 February 2025, having reviewed the submissions of the parties the Tribunal communicated a number of requests for clarification. These were, relevantly, as follows:

ORDER:

1. Direct that on or before 7 March 2025 the parties lodge with the Tribunal and serve on the other party any written submissions in response to submissions filed by the other party and in response to the Tribunal’s request for clarification dated today.

REASONS:

The respondent’s legal advisor has communicated to the Tribunal requesting directions that the respondent be permitted to file submissions in reply to the applicants’ submissions and that the applicants’ expert and respondent’s representatives meet to review the current status of the works and revise the Scott Schedule adduced at the hearing on 4 February 2025.

Both parties served submissions simultaneously. The applicants’ submissions were extensive and appear to have raised matters to which the respondent should be given an opportunity to respond. It may also be that the applicants wish to address the respondent’s submissions. Consequently, I will order that the parties be given an opportunity to file responses to the submissions filed by the opposing party/parties.

In the preparation of their submissions the Tribunal that the following issues also be addressed by the parties:

1. On what date do the applicants contend the building contract with the respondent was terminated and what are the acts or the conduct that constituted the termination ? In this respect, paragraph [61] of the applicants’ submissions states that the making of a money order will put an issue “beyond doubt” but if the applicants’ position is that the termination of the building contract has already occurred, then the date of that event needs to be stated.

2. If the applicants contend that the respondent repudiated the building contract what were the acts or what was the conduct comprising the repudiation ?

3. Do the applicants contend that they were not entitled to pay the 5th progress claim ? If they do contend that to be the case, then on what basis pursuant to the building contract were they entitled to not pay the 5th progress claim ?

4. Assuming that there is an evidentiary basis for the claim for interest payments to the bank, on what basis are the applicants entitled to recover agreed liquidated damages under the building contract and interest payments.

5. What is the respondent’s position as to its entitlement to payment in light of the alleged defects in the work undertaken by the respondent since 8 July 2024 and what ?

6. What is the respondent’s position as to the entitlement of the applicants to terminate the building contract and as to whether the respondent repudiated the building contract and what is the basis for that position ?

7. What is the basis of the respondent’s contention that the building contract is still on foot ?

8. On what basis under the building contract did the respondent suspend further work and what is the basis on which the applicants dispute that the builder was entitled to do so.

9. If the respondent contends that the Tribunal should not rely on any of the evidence that has been adduced because it is “apt to mislead” or some other ground, then the respondent must identify (i) the precise evidence to which the respondent intends to refer; (ii) the basis of the contention that the said evidence is apt to mislead (or similar criticism); and (iii) the evidence adduced at the hearing which supports that submission in respect of each item of evidence which it is said is “apt to mislead” to Tribunal.

In respect of each of the above questions, where a question is directed to one party the other party should state their position as well.

The parties should note that the Tribunal is aware of paragraph [36] of the applicants’ submissions, but the contentions in that paragraph are not sufficient explanation of matters arising from the questions above.

  1. A request for a further clarification was communicated on 19 February 2025.

  2. In this period the builder communicated to the Tribunal its objection to the Tribunal permitting the owners to be legally represented. On 20 February 2025 I granted leave for the owners to be legally represented. This was communicated to the parties with the following reasons:

The legal representative for Gujjar Construction Pty Ltd (the respondent) has sought a ruling on whether the applicants should be permitted legal representation.

The matter was heard on 4 February 2025. At the hearing the Tribunal granted leave for the respondent to be legally represented. One of the matters on which the respondent relied to secure the grant of leave was that there was some complexity in the proceedings. I accepted that submission and I granted leaving notwithstanding the applicants’ objections.

At the hearing the applicants did not have legal representation.

At the conclusion of the hearing I made directions for the filing of submissions. Submissions drafted by a legal practitioner were filed and served by the applicants. The respondent also filed and served submissions drafted by their legal representative.

The respondent has taken issue with the applicants filing submissions which were prepared by legal practitioners.

As the respondent submitted during the hearing on 4 February 2025, this dispute has some legal complexity. The submissions filed by both parties show that to be the case. It is of assistance to the Tribunal that all parties’ submissions are prepared by legal practitioners.

The respondent did not identify any prejudice in the applicants now being represented. It will certainly not affect the hearing which has concluded. The outstanding issues are matters of submissions only.

The respondent has also sought further time to file submissions in reply and to address the matters in the Tribunal’s communications dated 18 and 19 February 2025. The additional time sought is one week. The reason is said to be due to the unavailability of counsel. The extension is not very long and will not materially prejudice finalisation of this matter. Consequently, I will grant the extension.

  1. On 14 March 2025 the owners filed their submissions in reply and in response to the Tribunal’s communication.

  2. However, the builder sought a further extension of time. The builder advised that its counsel was not able to meet the timetable and that there were settlement discussions between the parties. When the request for an extension of time was brought to my attention it became apparent the owners position had not been articulated and this was requested by the Tribunal.

  3. The owners communicated their opposition to any extension of time and submitted that any issues of settlement were irrelevant. I agree that any issues of settlement are irrelevant to the question of whether to grant an extension unless both parties made such a request by consent. I was not inclined to grant the request for an extension of time for the builder. However, whilst this decision was reserved, on 26 March 2025, the builder lodged with the Tribunal its submissions and an expert report. The builder’s submissions dated 26 March 2025 have not caused delay in finalisation of this decision and I consequently have had regard to those submissions. In those circumstances, to the extent necessary, I will permit the extension of time.

  4. In relation to the builder’s expert report filed 26 March 2025, I do not propose to permit the builder to rely on it and I will not have regard to it. My reasons are as follows:

  1. Permitting the builder to rely on further evidence after the decision has been reserved will inevitably require that the owners be heard as to whether they wish to file material in reply or to cross examine the expert. If so, then there would be further delay.

  2. The builder has not formally applied to re-open its case. If it were to do so it would need to address the discretionary factors which might justify the grant of leave to re-open. In the absence of an application by the builder to re-open its case, those discretionary factors have not been articulated and consequently cannot be assessed with the consequence that the builder has not established that it would be a proper exercise of the Tribunal’s discretion to permit the builder to re-open its case.

  1. At the hearing on 4 February 2025 the following materials were tendered:

  1. Exhibit A - Bundle of documents filed on 30 October 2024 by the owners and tendered by the owners. Exhibit A contained at tab 6 an expert report bearing date 5 September 2024 authored by Charles Camenzuli of CATCAM Pty Ltd. The date was corrected during the hearing to 27 September 2024. Mr Camezuli is a structural engineer, a licenced builder and has 40 years of experience in the construction industry in Australia. Exhibit A also contained at tab 7 a Scott Schedule and brief report dated 28 September 2024, also authored by Mr Camenzuli. Exhibit A was tendered, in whole, without objection.

  2. Exhibit B – a copy of the Contract and tendered by the builder. I note that exhibit B appears to have inadvertently omitted page 25 of the Contract (using the Contract’s page numbering). The parties’ submissions did not refer to the clauses on the omitted page. I also note that Mr Kazi’s affidavit, read for the purposes of the adjournment application, contained a complete copy of the Contract.

  3. Exhibit C – bundle of documents recording signed variations to the Contract tendered by the builder.

  4. Exhibit D - bundle of photographs tendered by the builder.

  5. Exhibit E – emails dated 3 August 2024 and 12 September 2024 tendered by the owners.

  6. Exhibit F – quotations tendered by the owners.

  7. Exhibit G – stage 5 progress claim in the amount of $66,555.

  1. At the hearing on 4 February 2025 I marked all the exhibits using letters because at the commencement of the hearing it appeared that the builder would not be tendering any evidence and so that there was an easily identifiable distinction with the owners’ evidence before the Tribunal on 8 July 2024. However, as the hearing proceeded on 4 February 2025 the builder did tender documents.

  2. The owners called Mr Camenzuli to give expert opinion evidence. Mr Kazi cross examined Mr Camenzuli.

  3. It is fundamental to both procedural fairness to the parties and determination of the dispute on the merits that the Tribunal only have regard to the evidence adduced before it at the hearing. I have approached this decision on the basis that I am confined to the evidence adduced by the parties at the hearing on 4 February 2025.

Findings of Fact

  1. The Tribunal makes the following findings of fact.

Background

  1. As I have recorded above, on 12 October 2021 the owners entered into the Contract with the Builder for the construction of a residential dwelling at the Property.

  2. The Contract provided for six stages for the issuance of progress claims. These stages were headed as follows (omitting the more detailed descriptions of the work for each stage):

  1. Stage 1 progress claim (inclusive of deposit) – Floor slab complete - $88,740.00 including GST;

  2. Stage 2 progress claim - Roof frame complete - $88,740.00 including GST;

  3. Stage 3 progress claim – Close up complete - $88,740.00 including GST;

  4. Stage 4 progress claim – Fixings complete - $66,555.00 including GST;

  5. Stage 5 progress claim – Painting complete - $66,555.00 including GST;

  6. Stage 6 progress claim – Practical completion - $44,370.00 including GST.

  1. The building period was agreed to be 290 working days (Schedule 1, clause 6).

  2. There were substantial delays in the construction of the home and allegations of significant defects in the work that had been undertaken by the builder. As a consequence, Ms Jones commenced these proceedings on 26 January 2024.

  3. The matter was initially heard on 8 July 2024. Ms Jones represented herself. Mr Jones also attended the hearing and assisted Ms Jones. Mr Jasbir, the builder’s construction manager, appeared and represented the builder.

  4. At the 8 July 2024 hearing the parties each tendered a bundle of documents. The applicant relied on a 357 page bundle of documents filed 18 March 2024 which was marked exhibit 1. The builder relied on a 105 page bundle of documents filed 15 April 2024 which was marked exhibit A. These exhibits were not tendered at the 4 February 2025 hearing in respect of the renewal proceedings.

  5. At the 8 July 2024 hearing there was substantial agreement in respect of a number of matters. Those areas of agreement were formulated into proposed orders, which during the hearing both parties acknowledged as being agreed and consequently orders were made in those terms. The areas of agreement are reflected in orders 1-3 of the orders. An order as to costs was also made by the Tribunal on 8 July 2024 (order 4) although this was not by consent. The orders made on 8 July 2024 (the 8 July 2024 orders) are set out below:

1. By consent, the Tribunal orders the respondent Gujjar Construction Pty Ltd trading as Elante Homes, and or their contractor, to carry out the following work by 26 August 2024 in a proper and workmanlike manner.

The details of the work order are, by consent, on or before 26 August 2024, the respondent will complete the works pursuant to the contract dated 12 October 2021 so as to reach Practical Completion as defined in the contract, and rectify all the defects identified in the Scott Schedule dated 6 March 2024 (exhibit 1, pp. 332-356), such defects to be rectified in the manner set out in the Scott Schedule.

2. By consent, the respondent pay the applicant $13,240.00 by way of liquidated damages, such sum to be paid by way of providing a credit of that amount in the next stage progress payment claim.

3. By consent, the respondent shall permit access to the applicant’s building expert to the site for the purpose of inspecting the works once every fortnight at such times as the parties may agree and failing agreement on 48 hours’ notice during ordinary working hours, with the first occasion for the exercise of such access to be within 48 hours.

4. The respondent Gujjar Construction Pty Ltd Trading As Elante Homes, is to pay the costs of the applicant Allison Jones, as agreed or as assessed.

  1. A number of other issues between the partes were dealt with in the 8 July 2024 hearing and these were reflected in the reasons given on 8 July 2024. Those issues dealt with disputed variations, an allegation of duress or underhand conduct, a dispute about whether work comprising the encasement of a sewer had been undertaken and the party responsible for those costs. These matters are not relevant to the current dispute between the parties and were not referred to by the parties in their submissions.

Events since 8 July 2024

  1. After 8 July 2024 some work was undertaken but the evidence does not precisely establish the work undertaken after 8 July 2024.

  2. On 2 September 2024 the builder issued a progress claim for stage 5. It will be recalled that stage 5 is headed “Painting Complete”. The more detailed description of the work for stage 5 under the heading “Painting Complete” is as follows:

All ceramic tiling installed. Interior and exterior painting complete.

  1. At around this time, likely between 26 August 2024 and 2 September 2024, the owners contacted the Building Commission of NSW. On 2 September 2024 Mr Singh, an inspector with the Building Commission of NSW, carried out an inspection of the works. On 5 September 2024 a report was issued. That report was not in evidence. However, the 5 September 2024 report was referred to in an email dated 13 September 2024 from the Building Commission of NSW to the builder and the owners. That email was as follows:

Dear Sonali and Elante Homes,

It has been brought to our attention that your claim the work order has been completed is incorrect.

Jasvir Singh attended the site on 2 September 2024 with the homeowners and their building inspector and he was advised the work required was incomplete.

A report issued on 5 September 2024 has been provided as proof the works are incomplete.

The status of the order has been changed to not complied with and appears on the public register.

I advise you contact the homeowner and rectify all issues to comply with the order.

  1. On 13 September 2024 the owners filed these renewal proceedings, seeking an order for the payment of money.

  2. On 16 September 2024 the owners emailed the builder and advised that they would not pay the 2 September 2024 progress claim. The email relevantly records:

With the substantial amount of major and minor defects and painting not correct … we are unable to release ANY payments until the works are completed to meet the progress claim. There is a lot of work that needs to be done.

  1. On 16 September 2024 the builder responded to the owners as follows:

…we are stopping on-site due to non-payment of the fifth stage progress claim. The job will remain on hold until we receive the payment for this stage

  1. On 16 October 2024 the Tribunal made orders for the exchange of evidence and readying the matter for a hearing.

  2. At the hearing on 4 February 2025 there was no evidence of a progress claim for stage 6, although such a progress claim was referred to in the owners’ submissions. As explained above, the Tribunal can only make findings on the basis of the material properly before it and adduced as evidence.

Other matters relating to 8 July 2024 work order

  1. A component of the 8 July 2024 work order required the builder to “rectify all the defects identified in the Scott Schedule dated 6 March 2024 (exhibit 1, pp. 332-356), such defects to be rectified in the manner set out in the Scott Schedule”.

  2. For the most part Mr Camenzuli’s report did not identify which work was undertaken since 8 July 2024. The report also did not explain how any rectification work inspected by Mr Camenzuli deviated from the manner for rectification set out in the Scott Schedule dated 6 March 2024 (ie exhibit 1, pp. 332-356 in the 8 July 2024 hearing). Instead, Mr Camenzuli’s report identified defects as at 2 September 2024.

  3. Although it may be contended that the existence of the defects which Mr Camenzuli’s report identifies necessarily means that the builder did not rectify the defects in the manner set out in the Scott Schedule referred to in the 8 July 2024 orders, the evidence of Mr Camenzuli did not establish that was the case.

  4. Consequently, the Tribunal is not in a position to identify the specific defects rectified, or purportedly rectified, since 8 July 2024 nor the manner in which any rectification work deviated from the Scott Schedule referred to in the 8 July 2024 orders.

Consideration

Jurisdiction

  1. The Tribunal has jurisdiction to hear and determine building claims up to $500,000.00. Section 48A of the HB defines a building claim as follows:

building claim means a claim for—

(a) the payment of a specified sum of money, or

(b) the supply of specified services, or

(c) relief from payment of a specified sum of money, or

(d) the delivery, return or replacement of specified goods or goods of a specified description, or

(e) a combination of two or more of the remedies referred to in paragraphs (a)–(d),

that arises from a supply of building goods or services whether under a contract or not, or that arises under a contract that is collateral to a contract for the supply of building goods or services, but does not include a claim that the regulations declare not to be a building claim.

  1. The Contract required the builder to perform residential building work.

  2. These are renewal proceedings in which the owners sought a money order in respect of, amongst other things, breaches in the performance of the Contract relying on the warranties prescribed by s 18B of the HB Act. I am satisfied the owners’ claim is a building claim and that the Tribunal has jurisdiction to determine the owners’ proceedings.

Was practical completion reached by 26 August 2024

  1. For the reasons that follow, the Tribunal finds that the works the subject of the Contract did not reach practical completion by 26 August 2024.

  2. The Contract defines practical completion as follows:

practical completion means when the building works are complete except for minor omissions and defects that do not prevent the building works from being used for their usual purpose.

  1. Mr Camenzuli Report records at [44.1]:

There is no doubt that the house has not been completed.

  1. Mr Camenzuli’s conclusion at [44.1] is well founded. As at the date of Mr Camenzuli’s last inspection, namely 27 September 2024 (Ex A, tab 7), the extent of works that were defective was substantial and the cost to rectify such defects exceeded $100,000.00. Some of the defects included brickwork lintel coating (Ex A, tab 6, item 14; see also Ex A, tab 7, para 57(d)), roof flashing defects and water penetration, the absence of expansion joints in walls, the installed electrical wiring being non-compliant with standards and a safety hazard, defective bathroom waterproofing (Ex A, tab 6, item 32) and inadequate paint coverage (Ex A, tab 6, item 35).

  2. Further, because the stage 5 progress claim was issued on 2 September 2024 I infer that as at 26 August 2024 the builder was not in a position to issue the stage 6 progress claim. The stage 6 progress claim requires that the works reach practical completion.

  3. In addition, the 13 September 2024 email from the Building Commission of NSW records that the builder’s claim that “the work order has been completed is incorrect”. I infer that the reference to “work order” was the Tribunal’s 8 July 2024 work order because there was no evidence of any other relevant work order and because of the proximity of the time for compliance with the Tribunal’s work order (26 August 2024) and the involvement of the Building Commission of NSW.

  4. Another factor which I take into account is that there was no evidence that the builder issued a notice under clause 21.1 of the Contract. That clause provides as follows:

The builder must give the owner a notice of practical completion at least 5 working days prior to practical completion being reached.

  1. If practical completion had been reached, then it would have been more likely than not that the builder would have served a notice pursuant to clause 21.1. I give this circumstance little weight, but it is consistent with my conclusion that the builder did not reach practical completion by 26 August 2024.

  2. Finally, paragraph [55] of the builder’s submissions dated 26 March 2025 records, relevantly, the following:

55. The logical conclusion here is:

a. The [owners] to pay the progress payment under payment complete;

b. The [builder] to complete the works to bring the building works to practical completion;

c. The [owners] to pay for that progress claim;

d. The parties to have a joint report reflecting any defects for rectification;

e. Determination of works orders or monetary orders to be made following that joint report.

  1. Sub-paragraphs 55(b) and 55(c) of the builder’s 26 March 2025 submissions reflect, in my view, an acceptance by the builder that the work has not reached practical completion.

  2. Having regard to the above matters, the Tribunal finds that the builder did not comply with order 1 of the 8 July 2024 work orders in that the builder failed to carry out the work under the Contract so as to reach practical completion as defined in the Contract by 26 August 2024.

Builder’s submissions as to progress of the building work

  1. The builder’s submissions contended that the evidence before the Tribunal at the hearing “is outdated and does not reflect the work presently completed by the builder” (Builder’s submissions, 26 March 2025, [48]). For the reasons explained above, the Tribunal will determine the matter on the basis of the evidence as adduced at the hearing.

  2. The builder also submitted that the photographs in exhibit D showed that substantial work had been performed by the builder since the “report dated 5 October 2023” (Builder s submissions, 26 March 2025, [49]). That report was not in evidence. The report of Mr Camenzuli relied on at the 4 February 2025 hearing, and located at tab 6 of exhibit A, bore the date 5 September 2024. That date was corrected during the hearing to 27 September 2024.

  3. I have also sought to identify whether the builder’s reference to a report date 5 October 2023 was a simple error by considering other references in the builder’s submissions to the “report dated 5 October 2023” to see if those references could be sensibly applied to the contents of Mr Camenzuli’s report at tab 6 of exhibit A. One such reference, at [50] of the builder’s 26 March 2025 submissions, was to “images at page 4 dated 3 October 2023”. However, Mr Camenzuli’s report at tab 6 of exhibit A did not contain images at page 4. Further, the images found throughout Mr Camenzuli’s report were dated 2 September 2024, not 3 October 2023.

  4. In addition to the above matters, the evidence did not establish which work depicted in the photographs in exhibit D had not been undertaken as at the time of Mr Camenzuli’s inspections and Mr Camenzuli was not asked to consider the photographs in exhibit D and identify work depicted in those photographs which he accepts or concedes depicts work which had not been undertaken at the date of Mr Camenzuli’s inspection(s).

Status of the Contract at the hearing on 4 February 2025.

  1. At the hearing of the renewal proceedings on 4 February 2025 the parties accepted that the Contract had not been terminated.

  2. Furthermore, at the hearing the owners did not assert that the cessation of work by the builder constituted a repudiated. This position subsequently changed.

  3. In the owners’ submissions dated 11 February 2025 and 14 March 2025 the owners submitted that the Contract had been terminated by reference to three alternatives.

  4. First, the owners submitted that the Contract was terminated upon the filing and service of the renewal proceedings. No authority was cited for this proposition. Moreover, the proposition is not consistent with Blessed Sydney Constructions Pty Ltd b Vasudevan [2018] NSWCATAP 98 (Blessed) in that the Appeal Panel held that the building contract in that case was terminated, in the context of renewal proceedings, “when the Tribunal made the order for payment of money”: Blessed at [60].

  5. Next, the owners contended that the Contract was terminated by reason of the builder’s 16 September 2024 email advising that work on site would be “stopping” and that the “job will remain on hold until we receive the payment for this stage”. There are a number of difficulties with this submission. First, at the hearing it was common ground that the Contract had not been terminated. Second, the builder did not communicate that it would not do any further work. It communicated that the job was on hold pending payment. Third, even if the builder had no entitlement to suspend work, and therefore arguably repudiated the Contract, the owners did not contend that they had accepted the repudiation and terminated the Contract. Until the owners accepted a repudiation by the builder, the Contract remained on foot.

  6. I also note that under clause 25 of the Contract there are circumstances in which the builder may suspend the Contract. However, since the parties’ submissions did not rely on clause 25 I will not further consider that clause.

  7. The third alternative postulated by the owners as to the termination of the Contract is that the Contract is terminated if the Tribunal vacates the 8 July 2024 work orders and orders the builder to pay a monetary remedy. This is consistent with Blessed. Of course, the consequent is that the Contract was on foot as at the hearing of the renewal proceedings and whether the Contract is terminated will depend on the relief granted by the Tribunal. Put another way, it is not until the Tribunal vacates the 8 July 2024 work orders and orders the builder to pay a monetary remedy that it can be said the Contract has been terminated.

Owners’ position as to non-payment of stage 5 progress claim

  1. In relation to the owners’ entitlement to not pay progress claim dated 2 September 2024, the owners made the following submission (Owners submissions, 11.02.25, [67]):

It is submitted that instead of focusing on completing the numerous works that the Builder accepted were incomplete and to do so by the due date of 26 August 2024, the Builder issued the progress claim. The [owners] submit that there is no legitimate basis for such a claim and that it should be rejected given the weight of the uncontradicted evidence that works were incomplete at the date of issuing the claim.

  1. On 18 February 2025, the Tribunal sought clarification from the owners as to whether they contended they were entitled to not pay the stage 5 progress claim and, if so, the “what basis pursuant to the building contract were they entitled to no pay [that] progress claim”. Unfortunately, the owners’ submissions in response were unhelpful. The owners’ response, conveyed in submissions filed by their legal representatives, was as follows:

The [owners] contend that they are entitled to not pay the 5th progress claim on the basis of the overwhelming evidence that in the Camenzuli Report and Camenzuli Scott Schedule detailing extensive defective works and non-completion of works for which payment was sought by the [builder].

  1. The owners’ submissions did not articulate the contractual basis on which the owners contend they were entitled to withhold payment. The owners did not contend that on its true construction the Contract required that a progress claim could only be made upon completion of the work for that stage.

  2. The owners’ submission appears to be that cumulative defects were, as at mid-September 2024, extensive and evident so as to entitle them to not pay the progress claim. However, the contractual significance of those circumstances and why it relieved the owners from the requirement to pay the progress claim as a matter of contract were not explained. The owners did not say that the cumulative defects, for example, constituted a repudiation by the builder. Had that been the contention then it would have given rise to the question of whether the owners, as a consequence, accepted the repudiation and brought the Contract to an end.

  3. Similarly, the owners did not engage with authorities such as Brewarrina Shire Council v Beckhaus Civil Pty Ltd [2005] NSWCA 248 (“Brewarrina”), in terms of their purported contractual entitlement to not pay the progress claim.

  4. Consequently, the owners have not explained the basis on which they were entitled to not pay the stage 5 progress claim.

  5. I also accept that the correct contractual analysis concerning the builder’s response to non-payment of the stage 5 progress claim is set out in the builder’s submissions dated 26 March 2025 at [10] and [11].

Defective and incomplete work and loss

  1. The owners relied on Mr Camenzuli’s report for evidence of the defective or incomplete work as at the date of the report (Ex A, tab 6). Mr Camenzuli also quantified the cost to rectify the defects or incomplete work in a Scott Schedule (Ex A, tab 7).

  2. Mr Camenzuli was cross examined during the hearing and answered further questions raised by the Tribunal. The cross examination of Mr Camenzuli established that he had not visited the site since his inspection on 27 September 2024. Mr Camenzuli’s evidence as to the defects was not undermined or diminished by the cross examination.

  3. I have considered Mr Camenzuli’s report (Ex A, tab 6) and I accept his conclusions as to the defective or incomplete for the reasons he has given in his report except to the extent identified in the following paragraphs. I have also considered Mr Camenzuli’s further observations at paragraph [57] of his report attaching the Scott Schedule (Ex A, tab 7).

  4. I now turn to the defective or incomplete works which I do not accept have been established by Mr Camenzuli’s report or otherwise established by the owners. All references in the following paragraphs to the amount claimed by the owners relates to the quantum before consideration of an allowance for miscellaneous costs, preliminaries, builder’s margin and GST. These will be considered separately.

  5. Item 22 relates to anchorage of the roof tiles to the roof battens. The amount claimed by the owners for this defect is $12,450.00. Mr Camenzuli inspected four random locations and observed that the roof tiles were insufficiently secured in the areas observed from those locations (Ex A, tab 6, [22.3]). Mr Camenzuli then extrapolated that the defect would be likely be present throughout the roof. Mr Camenzuli explained that it would be unreasonable to inspect the whole roof to determine if the full extent of the defect.

  6. Whilst Mr Camenzuli’s reasoning that it would be burdensome to inspect the whole roof to determine the full extent of the alleged defect is understandable, I am not satisfied that from an inspection at four locations the Tribunal can infer that the defect exists in respect of the whole of the installation of the roof tiles.

  1. Item 46 relates to landscaping. The owners claim $7,804.00 for this item relying on a quote from a third party landscaping company. Mr Camenzuli’s Scott Schedule (Ex A, tab 7) includes this claim but his 2 September 2024 report at exhibit A, tab 6 does not deal with the issue of landscaping. I do not accept this claim because the owners have not identified the scope of the builder’s obligation under the Contract and that the scope of the $7,804.00 landscaping quote is the same as that required by the Contract.

  2. Mr Camenzuli’s Scott Schedule included at item 47 a claim for $1,800.00 The owners rely on a quote from Anthony Eurell Plumbing Pty Ltd (Plumber’s Quote) of $4,120.00 plus GST. The plumbing quote was at exhibit A, tab 7, pp. 49-50 and was for an amount of $4,120.00 plus GST. Mr Camenzuli has made an estimate that $1,800.00 of the Plumber’s Quote is “over and above items” identified in Mr Camenzuli’s report and Scott Schedule (Ex A, tab 7, p. 30). However, the evidence does not explain how this estimate was made. There is no explanation of what items in the Plumber’s Quote make up the $1,800.00. Nor does the evidence explain the basis on which the owners are entitled to the items in the Plumber’s Quote which are “over and above items” identified in Mr Camenzuli’s report and Scott Schedule. Consequently, the Tribunal is not satisfied that the owners have established item 47.

  3. Consequently, the Tribunal is not satisfied that the following items of defective or incomplete have been established:

  1. Item 22, roof tile anchorage - $12,450.00;

  2. Item 46, landscaping quote - $7,804.00;

  3. Item 47, plumbing quote - $1,800.00.

  1. Consequently, the value of the items in the preceding paragraph is to be subtracted from Mr Camenzuli’s calculation of the total value of loss. That value is $22,054.00

  2. I will also explain the reasons that the Tribunal has accepted item 45 because Mr Camenzuli’s report (Ex A, tab 6) did not deal with the claim in item 45. Item 45 relates to incomplete work by way of electrical work and electrical fittings and the amount claimed is based on a quote from Jaycab Electrical for $15,053.00. The Jaycab Electrical quote was attached to Mr Camenzuli’s Scott Schedule (see Ex A, tab 7, pp. 45-47). Item 45 is distinct from the electrical wiring defects identified in Mr Camenzuli’s report and the Scott Schedule at items 29 and 30. Item 45 is a claim for work that was not installed by the builder that was (allegedly) required by the Contract.

  3. In Khan v Kang [2014] NSWCATAP 48 (Khan) the Appeal Panel, in considering the evidentiary purposes for which a quotation may be used, said at [50]:

A quotation from a supplier willing to rectify defects or complete incomplete work can, depending on the circumstances and the nature and content of the quotation, constitute evidence of the defects or incomplete work and of the amount required to remedy the defective work or complete any incomplete work. For example, if the person providing the quotation was suitably qualified or experienced, inspected the work, identified defects or incomplete work on that inspection, recorded his or her observations in the quotation and gave a price to rectify or complete the work, it is difficult to understand why that quotation would not provide evidence in support of a claim for defective or incomplete work. The weight to be given to the evidence would, of course, depend upon many factors. Nonetheless, it would be wrong to conclude that simply because an applicant relied only upon a quotation or quotations for the rectification or completion of work that there was no evidence to support the claim that the work was defective or incomplete.

  1. The Jaycab Electrical quote records the following words:

ADDITIONAL NOTES: Quote to repair defects or uncompleted work from report on property ****, Box Hill NSW 2765

Items missing or incomplete as per electrical plans

  1. I infer that the “electrical plans” to which the Jaycab Electrical quote refers are the electrical plans that were part of the Contract scope. I do so because that would ordinarily be the most likely basis on which to proceed for a claim for work or materials not supplied under a contract and because the builder did not raise any issue that the items in the quote were not required by the Contract.

  2. The Jaycab Electrical quote is detailed and clear. It describes each allegedly missing item. It identifies the unit price for each item and the number of units required (ie the number of units missing). I infer the quote was prepared consequent upon an inspection of the Property because that is the most likely, perhaps only, manner in which such a quote could have been constructed.

  3. Having regard to the Appeal Panel’s observations in Khan, I am satisfied that the Jaycab Electrical quote records the cost to install missing or incomplete items as per the electrical plans.

  4. I turn to consider the issue of an allowance for miscellaneous costs, preliminaries and builder’s margin. Mr Camenzuli’s Scot Schedule provided an allowance for miscellaneous items of 10%, an allowance for preliminaries of 15% and a builder’s margin of 30%. During the hearing Tribunal questioned Mr Camenzuli about these allowances or margins during the hearing. In terms of miscellaneous items, Mr Camenzuli explained that in his 45 years of experience such an allowance was always made. In relation to the allowance for preliminaries, Mr Camenzuli identified costs such as insurance and fencing which are contemplated by the 15% allowance. In relation to the builder’s margin Mr Camenzuli said that the 30% margin he had adopted was appropriate because “no one wants to touch a re-fix”.

  5. I accept that, all other things being equal, the builder’s margin on a remediation project is likely to be higher than the builder’s margin for a new project. Although it is more common for a builder’s margins to be in the vicinity of 15% to 25% I am prepared to accept the 30% figure in respect of this dispute. I have also been prepared to accept a builder’s margin of 30% so as to cover some element of uncertainty and this also impacts my assessment of the proper allowance for miscellaneous costs.

  6. I do not accept that the 10% allowance for miscellaneous costs has been established. I accept that some uncertainty should be allowed. However, I do not accept that an allowance for miscellaneous costs of 10% is appropriate because I have not been persuaded that the degree of uncertainty to rectify the defects justifies a 10% allowance. I also refer to my observation in the preceding paragraph as to the builder’s margin which I accepted should be 30% in part so as to cover uncertainties. I will allow 5% for miscellaneous costs.

  7. I accept that preliminary costs will be incurred and I accept that those costs are likely to be in the range estimated by Mr Camenzuli, namely 15%.

  8. In relation to those items in the Scott Schedule where the owners rely on a quote from a third party, I do not accept that the measure of damages should also include an allowance for miscellaneous costs, preliminaries and a builder’s margin because the quotes are for a fixed sum. For the same reason, I also do not accept that GST should be added to the items in the Scott Schedule where the owners rely on a quote from a third party unless that quote expressly excludes GST.

  9. Consequently, the total value of loss attributable to defects that I have accepted will be calculated as follows:

  1. First, Mr Camenzuli’s total value before miscellaneous costs, preliminary costs, builder’s margin and GST but including third party quotes is $164,287.00;

  2. Next, subtract the items that the Tribunal has found were not established by the owners of $22,054.00. This gives a sub-total of $142,233.00.

  3. Next, subtract quotes for work from third parties for which no allowance for miscellaneous costs, preliminaries, builder’s margin and GST should be included, being $15,053.00 for the Jaycab quote. This gives a sub-total of $127,180.00.

  4. Next, calculate the 5% allowance for miscellaneous costs on $127,180.00, which is $6,359.00;

  5. Next, calculate the 15% allowance for preliminary costs on $127,180.00, which is $19,077.00;

  6. Next, add the values calculated in sub-paragraphs (4) and (5) above to $127,180.00. This gives a sub-total of $152,616.00;

  7. Next, add the builder’s margin of 30% to $152,616.00, which is $45,784.80. This gives a sub-total of $198,400.80;

  8. Next, add 10% GST on $198,400.80 which gives a sub-total of $218,240.88;

  9. Next, add the Jaycab Electrical quote of $15,053.00 to $218,240.88 which gives a total of $233,293.88.

  1. The next step to that is required to quantify the owners loss is to subtract the unpaid progress claims. This step was not in dispute and expressly stated as necessary in the owners’ submissions (see Ex A, tab 1, p. 1, paragraph 2). This is also consistent with the builder’s submission (see Builder’s submissions, 26 March 2025, [44]). The relevant progress claims are $66,555.00 for stage 6 and $44,370.00 for stage 6. Subtracting the stage 5 and stage 6 progress claims from $233,293.88 gives a total of $122,368.88.

  2. The builder submitted that the Scott Schedule attached to the renewal proceedings did not form part of the body of evidence before the Tribunal (Builder’s submissions dated 26 March 2025, [51]). In these reasons, the Tribunal has relied on the Scott Schedule at tab 7 of exhibit A. As recorded above, exhibit A was tendered by the owners without objection from the builder.

Remedy – work order or monetary order

  1. From the above, the owners have established that the builder did not comply with the 8 July 2024 work order in that the builder failed to carry out the work under the Contract so as to reach Practical Completion by 26 August 2024. The owners have also established that the defects in the works are significant and in terms of monetary value amount to $122,368.88.

  2. The next issue is whether the Tribunal should make a work order or a monetary order.

  3. Section 48MA of the HB Act provides as follows:

A court or tribunal determining a building claim involving an allegation of defective residential building work or specialist work by a party to the proceedings (the responsible party) is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome.

  1. In Culina v Timilty Constructins Pty Ltd [2022] NSWCATCD 109 (Culina) Senior Member Burton SC undertook a detailed and comprehensive consideration of the issues that inform the application of s 48MA: see [14]-[22].

  2. The hearing on 4 February 2025 brought by way of a renewal of proceedings pursuant to clause 8 of Schedule 4 of the Civil and Administrative Tribunal Act 2013 (CATA). That clause provides as follows:

(1) If the Tribunal makes an order in the exercise of a Division function in proceedings, the Tribunal may, when the order is made or later give leave to the person in whose favour the order is made to renew the proceedings if the order made is not complied within the period specified by the Tribunal.

(2) If an order has not been complied with within the period specified by the Tribunal the person in whose favour the order was made may renew the proceedings to which the order relates by lodging a notice with the Tribunal, within 12 months after the end of the period, stating that the order has not been complied with.

(3) The provisions of this Act apply to a notice lodged in accordance with subclause (2) as if the notice were a new application made in accordance with this Act.

(4) When proceedings have been renewed in accordance with this clause, the Tribunal:

(a) May make any other appropriate order under this Act or enabling legislation as it could have made when the matter was originally determined, or

(b) May refuse to make such an order.

(5) This clause does not apply if:

(a) The operation of an order has been suspended, or

(b)The order is or has been the subject of an appeal.

  1. In Bondarek v NSW Land and Housing Corporation [2018] NSWCATAP 299 (Bondarek) the Appeal Panel explained that the renewal power is “not simply an aid to enforce” orders already made. Where there has been non-compliance with orders previously made, the Tribunal is considering “what to do next given a non-compliance”. At [44] – [45] the Appeal Panel said:

[44] This interpretative assistance reinforces the purpose, object and context of the renewal power. It is not simply an aid to enforce the Tribunal’s existing orders as clause 4(a) makes clear in its reference to “make any other appropriate order”. There is no restriction in the clause to the existing material before the Tribunal or its existing findings on that material.

[45] Rather, it is to consider what to do next given a non-compliance, but not to rehear the substantive merits already determined, and to do that on the basis of material put forward by the parties relevant to the issue of what to do next. As was said in Akratos v Papadopoulos [2016] NSWCATAP 139 at [36]:

the purpose of the renewal proceedings was to consider, in light of the fact that the original order was not complied with, what other appropriate orders it could have made when the matter was originally determined and not to reconsider the substantive merits of the respondent’s building claim.

  1. Under the general law, where a building contract is still on foot and the works have yet to be delivered to the owner, or control of the works has yet to be handed to the owners, then damages for work that is defective is not ordinarily available. In Brewarrina Ipp JA, with whom Hodgson and McColl JJA agreed, relevantly held:

[68] While, on this assumption (the Contract still being on foot), the Council may have been entitled to claim damages for delay arising out of Beckhaus’ failure to achieve practical completion by the date for practical completion, it could not sue Beckhaus for defective or incomplete work. As long as the Council maintained that the Contract was alive and had not been terminated, and held Beckhaus to its obligation to complete the work in accordance with the specification, on its contention the work remained lawfully in Beckhaus’ possession. In other words, it was an inevitable incident of the Council’s argument that the work had not been delivered to and accepted by the Council (Beckhaus - on the Council’s argument - being in possession of and obliged to complete the work). While the work was in Beckhaus’ possession, the Council suffered no loss by reason of defective or incomplete work; the work, not being in the Council’s possession, did not at that stage form part of its patrimony.

[69] This situation would have changed when the Contract was terminated. When that occurred, the work (in its defective and incomplete state) was handed over to the Council. At that stage, the Council suffered loss by being in possession of defective and incomplete work.

  1. However, where non-compliance with a work order is established by a party in the determination of a renewal application then the Tribunal has the power to order the builder to pay monetary compensation notwithstanding that the building contract had not been terminated as at the date of the hearing. In Blessed the Appeal Panel, comprising President Wright and Principal Members Harrowell and Pearson, explained the relationship between the status of a building contact, renewal proceedings and the availability of damages as a remedy in the context of renewal proceedings. At [61] – [69] the Appeal Panel made the following observations:

[61] It was not in dispute that prior to the original hearing on 16 March 2016 the building contract between the homeowner and the builder was still on foot. The orders made on 16 March 2016, as a result of the agreement reached on that day, expressly stated that:

“The builder [was] to perform the work as per the written contract AND the variations as agreed between the parties and signed by the parties and their legal representatives and their experts and dated today and placed with the papers”.

[62] As a result of those orders, there continued to be a contract between the parties after that time, but its terms were the terms of the original written building contract as amended or modified by the agreement reached on 16 March 2016.

[63] It was not in dispute that the order of 16 March 2016 was not complied with within the time specified by the Tribunal in the order.

[64] In cases where a Court has ordered specific performance of a contract, it has been accepted that the leave of the Court is required before a contract that is the subject of such an order can be rescinded and damages recovered. In Sunbird, Mason CJ said at 260:

“In the light of the existing authorities,…, there being no argument challenging their correctness, we should continue to apply the proposition that rescission after an order for specific performance requires the leave of the court or, more appropriately, the vacation of the order. These authorities proceed on the footing that once a plaintiff has obtained an order for specific performance of a contract, he cannot be permitted to act inconsistently by rescinding it so long as the defendant is required by order of the court to complete the contract.

…

Loss of bargain damages are recoverable only if the contract is at an end. Once termination due to the defendant’s wrongful conduct is established the plaintiff is entitled to damages for loss of bargain: Dominion Coal Co. Ltd v. Dominion Iron & Steel Co. Ltd (1909) AC 293, at p 311. ….”

[65] It appears to us that a similar position should apply in the Tribunal where an order has been made for specific work to be carried out in performance of a contract. In home building matters, such work orders can be made under s 48O(1)(c)(i) of the HB Act, which empowers the Tribunal to make “an order that a party to the proceedings … do any specified work or perform any specified service or any obligation arising under … the terms of any agreement”. Such orders are, in fact, common in home building matters in the Tribunal, especially having regard to the terms of s 48MA of the HB Act. Applying the principles in Sunbird to work orders made by the Tribunal, we are of the view that once a party has obtained an order for work to be carried out in performance of a contract, that party cannot rescind the contract so long as the other party is required by the order to complete the contract.

[66] Where, however, the party bound to carry out the specific work does not do so within the time specified in the order and the right to renew proceedings arises, the circumstances may change. In the present case, the homeowner lodged a notice to renew proceedings in which the orders sought included:

(1) A renewal of the proceedings;

(2) The payment of an amount representing the cost of completing the works listed in the original order; and

(3) “Any other orders the Tribunal sees fit”.

[67] In accordance with the principles referred to in Brewarrina and Sunbird, an order for the payment of an amount representing the cost of completing the unfinished work should not be made while the contract that was the subject of the work order made on 16 March 2016 remained on foot. That does not mean, however, that a money order cannot be made on a renewal application such as the present.

[68] It is inherent in the making of this renewal application, in which a money order is sought in lieu of the work order, that the homeowner was no longer holding the builder to performance of the contract that was the subject of that work order. By her renewal application, the homeowner was seeking, in effect, to terminate the contract because of the builder’s breach of the contract, which was also a failure to comply with the work order. Looking at the substance of what was being sought by the renewal application, we are of the view that this application should properly be understood as involving, expressly by the orders sought (including “[a]ny other orders the Tribunal sees fit”) and implicitly:

(1) vacation of the original work order;

(2) an election by the homeowner to terminate the contract the subject of the work order, if and when that order was vacated; and

(3) in place of the work order, the making of an order “that one party to the proceedings pay money to another party by way of … damages”, which the Tribunal is empowered to make in determining a building claim, under s 48O(1)(a).

[69] If the renewal application is understood in this way, the orders that can be made include a money order for damages because the contract will no longer be on foot when the original work order is vacated, the homeowner’s election to terminate the contract takes effect and the work order is replaced by a money order.

  1. The Appeal Panel in Blessed also made the following observations in relation to the effect of a renewal proceedings following non-compliance with a work order:

[40] …Integrity involved a renewal application following non-compliance with a work order. When such an order is vacated on a renewal application, the builder is no longer required to comply with the contract and termination of the contract can then occur. By seeking to replace the work order with an order for payment of money by way of damages, the owner has in effect exercised the right to terminate the contract, subject to the Tribunal’s deciding to relieve the builder from complying with the contract. In Brewarrina the builder was still required to comply with the contract.

  1. In these proceedings the builder opposes a monetary remedy and seeks time to remediate the defective or incomplete work.

  2. I have concluded that in these proceedings a monetary remedy represents the appropriate relief.

  3. The first matter that I take into account is that a work order has already been made and the builder did not comply with that order. The date of 26 August 2024 passed and the works had not reached practical completion. There was also no explanation for the builder’s non-compliance with the work order made on 8 July 2024.

  4. The second matter is that the Building Commission of NSW advised the builder in September 2024 that the contention that the work order had been completed was not correct and that the builder should “rectify all issues”.

  5. Having regard to the 8 July 2024 work order and the communication from the Building Commission of NSW the builder has been given a fair opportunity to complete the work as it agreed, both under the Contract and by reason of the 8 July 2024 orders.

  6. The third matter I take into account is that the defects are significant in monetary value. The extent of the defects, based on the evidence adduced at the hearing, is significant in monetary terms, whether in absolute terms or by reference to the Contract price. An interrelated issue is that notwithstanding the significance of the defects, during the hearing the builder did not engage with the issue of the defects in terms of identifying what it intended to do to rectify the defects and how it would do so. I do give weight to the builder’s position at the hearing that it would rectify the defects. However, the builder did not, for example, accept expressly that all the issues that were identified by Mr Camenzuli required rectification in the manner identified by Mr Camenzuli or identify the extent to which it contested Mr Camenzuli’s conclusions. Nor did the builder adduce evidence as to how and when the defects were to be addressed.

  7. The next matter that I take into account is that one of the defects that Mr Camenzuli identified was the inadequate painting and in particular that an “additional layer is required all round” (Ex A, tab 6, p. 109, [15.1]). The stage 5 progress claim was issued after the hearing of this matter on 8 July 2024. Consequently, the quality of the builder’s work undertaken, at least in part after the 8 July 2024 hearing, was not of an appropriate standard.

  8. I have not given any weight to the effluxion of time since 16 September 2024 because after that point in time the builder was in a position where the owners advised they would pay the stage 5 progress claim. Although the owners submitted that the defects as at 16 September 2024 constituted a termination of the Contract I have not accepted that submission. In fact, at the hearing the owners accepted that as at 4 February 2025 the Contract had not been terminated. In those circumstances, in terms of assessing the appropriate remedy, I have not given any weight to the effluxion of time since 16 September 2024.

  9. I have given weight to the statutory preference expressed in s 48MA in that I have weighed up that matter against the factors which I consider to be counter-veiling factors. I have given weight to the preferred outcome that the builder should rectify the defective work. However, I have concluded that in this dispute the counter-veiling factors identified above outweigh the statutory preference. Consequently, I will make an order vacating the 8 July 2024 work order and order that the builder to pay the owners a sum of money.

  10. The builder submitted that the owners would be unjustly enriched if the Tribunal permitted the owners to terminate the Contract (Builders’ submissions, 26 March 2025, [27] – 32]). I will treat this submission as also applying to the circumstance of the Tribunal making monetary orders along the lines outlined in Blessed. The builder’s submission was partly founded on an assertion that the owners evidence is “outdated” and that their evidence “does not reflect the building as it is presently”: see [31]. The problem with such submissions is that they invite the Tribunal to make findings on the basis of matters other than the evidence before the Tribunal.

  11. The builder also submitted that the owners breached an implied term of good faith (Builders’ submissions, 26 March 2025, [33] – [36]). Again, I will treat this submission as also applying to the circumstance of the Tribunal making monetary orders along the lines outlined in Blessed. The identified breach was the failure to pay the stage 5 progress claim. The builder submitted that this breach then engaged the prevention principle: see [36].

  12. In terms of the prevention principle, the builder submitted that the owners could not benefit from their own wrong: see Probuild Constructions (Aust) Pty Ltd v DDI Group Pty Ltd [2017] NSWCA 171 (Probuild). One manifestation of that principle is that “a party cannot insist on the performance of a contractual obligation by the other party if it itself is the cause of the other party’s non-performance”: see Probuild at [114]. This submission by the builder has substance in respect of the effluxion of time since 16 September 2024. However, the considerations which I weighed in deciding whether or not to award a monetary remedy did not include as a factor against the builder the effluxion of time since 16 September 2024, being the date that the owners advised they would not pay the stage 5 progress claim.

  13. The builder also submitted that if the Contract was treated as terminated then the builder would have a cause of action based on estoppel (Builder’s submissions, 26 March 2025, [41]-[43]). In summary, the builder contends that termination of the Contract involves an unconscionable departure from representations on which the builder relied to its detriment. The alleged representations were, in effect, that the owners would act in accordance with their obligations under the Contract. I do not accept the builder’s submission in that, as articulated in the builder’s 26 March 2025 submissions at paragraph [41], the contention is in effect that a proprietary (or perhaps promissory) estoppel is created by departure from the contractual terms where that departure would, as articulated, be no different from a breach of the contractual terms.

Other monetary claims

  1. The owners also claim liquidated damages pursuant to the Contract and, in the alternative, a claim for interest paid by them on a loan.

  2. Clause 32 and item 11 of the Contract provide that liquidated damages would be $40.00 per working day.

  3. On 8 July 2024 the Tribunal made an order by consent that “the [builder] pay the [owner] $13,240.00 by way of liquidated damages, such sum to be paid by way of providing a credit of that amount in the next stage progress claim”. The next stage progress claim contemplated by that order was the stage 5 progress claim.

  4. The effect of these reasons is that the stage 5 progress claim will not be required to be paid by the owners. Consequently, the liquidated damages referred to in the 8 July 2024 order will need to be paid. The alternative manner in which the same result would have been reached would have been to deduct the sum of $13,240.00 from the stage 5 progress claim when effecting the calculation described in paragraph 105 above.

  5. The owners claim liquidated damages of $24,240.00 for the period 24 September 2024 to 11 February 2025 on the basis of 606 working days in that period.

  6. The difficulty with the owners’ claim for liquidated damages for the period from 24 September 2024 is that the owners had not paid the stage 5 progress claim and have not demonstrated a contractual basis for withholding payment, particularly in circumstances where at the hearing on 4 February 2025 the parties accepted that the Contract had not been terminated. In other words, the owners did not show that the effluxion of time since September 2024 was a contractual breach which was the cause of loss entitling them to an award of damages against the builder. In those circumstances, I am not persuaded that the owners were in compliance with their obligations under the Contract after advising the builder that they would not pay the stage 5 progress claim. It follows that I am not satisfied that the owners have established a basis for further liquidated damages.

  7. The claim for interest cannot be upheld in respect of the period prior to the 8 July 2024 orders. In respect of that period the liquidated damages provisions represent the parties’ agreed pre-estimate of damages.

  8. The parties did not address whether a claim for interest for delays in reaching practical completion can be sustained where the parties have contractually agreed on a provision as to liquidated damages as compensation for delays in completion of the work. Without deciding the matter, it seems to me that where the parties agree on a liquidated damages provision that addresses delays by the builder in completing the work, the owner cannot claim damages by way of interest for such delays.

  9. In any event, there was no evidence before the Tribunal of the interest paid by the owners in the period 24 September 2024 to 4 February 2025 (the date of the hearing of the renewal proceedings) or 24 September 2024 to 11 February 2025 (the date claimed in the owners’ submissions). The owners’ submissions dated 14 March 2025 refer to materials filed on 18 March 2024. Those documents were not adduced at the 4 February 2025 hearing. In any event, materials filed in March 2024 precede the date 24 September 2024 and consequently could not contain bank statements from September 2024 onwards (see owners’ submissions, paragraph 7(d)). Further, those documents were not adduced again on the hearing of the renewal proceedings.

  10. Consequently, the monetary order will be the sum of $122,368.88 and $13,240.00 which is $135,608.88.

Certificates

  1. The owners seek orders for the provision of certificates.

  2. However, the owners’ submissions accepted that there was “no direct evidence of the certificates” at the 4 February 2025 hearing (Owners’ submissions dated 18 March 2025, paragraph 7(b)).

  3. The owners’ submissions suggest that the Tribunal should take judicial notice that these documents should be handed over so that an occupation certificate can be obtained. The owners listed the following certificates:

  1. Interim Occupancy Certificates (if any);

  2. Final Survey Plan (Certifying all setbacks, floor levels and ridge levels are shown clearly on the survey);

  3. Termite Certificate;

  4. Sydney Water Project Completion Certificate;

  5. Waterproofing certificate;

  6. Smoke Alarm Certificate;

  7. Plumbing Certificate of Compliance;

  8. Electrical Certificate of Compliance - Fair Trading certificate;

  9. Windows/Glazing Certificate - from Manufacturer;

  10. Shower screen Certificate - from Manufacturer;

  11. Stormwater Compliance certificate;

  12. OC Application form (completed parts by the Builder);

  13. Planning portal lodgement for Partial OC;

  14. Retaining walls to be completed and engineer’s certificate if retaining wall is 600mm or more,

  15. Landscaping Compliance Certificate;

  16. BASIX Compliance Certificate signed by builder; and

  17. Work Permit Compliance Certificate from Council.

  1. The difficulty with the owners’ submission is that the framing of an order should be directed to the relevant certificates and the Tribunal needs to be satisfied that the work was undertaken.

  2. Since the builder is obtaining a full “credit” for the stage 5 and stage 6 progress claims, and will be relieved of further performance, then any certificates that have been issued or provided to the builder should be provided to the owners. However, since the Tribunal does not know which certificates have been issued or provided to the builder, the order that will be made will be framed so as to take that matter into account.

Warranty manuals and keys

  1. The owners also seek an order for keys, remote controls and warranty manuals. Again, to the extent the owners have paid for these items in that they are the subject of paid progress claims and the builder has these items then the builder should hand them over to the owners.

Costs

  1. The owners’ submissions appear to seek a lump sum costs order paid on an indemnity basis.

  2. Since the amount claimed or in dispute in these proceedings exceeds $30,000.00. Consequently, the provisions of rule 38 of the Civil and Administrative Tribunal Rules 2014 are engaged. That ordinarily means that costs follow the event.

  3. The owners contended that the many aggravating factors such as delays justified an indemnity costs order (Owners’ submissions, 11 February 2025, [99]). The purpose of an award of costs is not to punish the unsuccessful party: Baxter Global Investments Pty Ltd v Macro (No 2) [2020] NSWSC 1487 at [46]. The owners’ submissions have not explained how the alleged “aggravating factors” justify an indemnity costs order in a way which would not mean that the costs order is a form of punishing the builder.

  4. The owners’ submissions referred to the circumstances which might justify a lump sum costs order but did not appear to request a specific sum by way of costs. In any event, in relation to whether or not the costs order should be a lump sum costs order I am not satisfied that I should, without proper evidence and on the basis only of submissions, make an order for costs by way of a sum of money.

Orders

  1. The Tribunal makes the following orders:

  1. Dismiss the respondent’s Adjournment Request filed 3 February 2025.

  2. Grant leave for the respondent to be legally represented by Mofazzal Haque Kazi of Kazi & Associates, solicitors.

  3. Order that Luke Matthew Jones be joined as the second applicant.

  4. Grant leave for the applicants to be legally represented by Benjamin Barrak of Barrak Lawyers.

  5. Extend the time for the respondent to file submissions in reply to 26 March 2025.

  6. Vacate orders 1 and 2 of the orders dated 8 July 2024.

  7. Order the respondent to pay the applicants $135,608.88 within 14 days.

  8. Order pursuant to pursuant to s 48O(1)(c)(ii) of the Home Building Act 1989 (NSW) that that the respondent deliver to the applicants any of the certificates or documents referred to in paragraph [141] of these reasons to the extent that those certificates or documents are in the possession of the builder and are referrable to work for which the applicants have paid the builder.

  9. Order pursuant to pursuant to s 48O(1)(c)(ii) of the Home Building Act 1989 (NSW) that that the respondent deliver to the applicants any warranties or items referred to in paragraph [143] of these reasons to the extent that those warranties or items are in the possession of the builder and are referrable to work for which the applicants have paid the builder.

  10. Order the respondent to pay the applicants’ costs on the ordinary basis, as agreed or assessed.

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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: 27 June 2025

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Cases Citing This Decision

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Cases Cited

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Statutory Material Cited

3

Baxter Global Investments Pty Ltd (ACN 159 246 670) v Marco (No 2) [2020] NSWSC 1487
Brewarrina Shire Council v Beckhaus Civil Pty Ltd [2005] NSWCA 248
Culina v Timilty Constructions PL [2022] NSWCATCD 109