Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (No 2)

[2025] NSWCA 210

Court of Appeal

Supreme Court

New South Wales

Medium Neutral Citation:

Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (No 2) [2025] NSWCA 210

Hearing dates:

On the papers

Decision date:

12 September 2025

Before:

Adamson JA at [1]
Stern JA at [63]
Price AJA at [64]

Decision:

(1)   Judgment for the plaintiffs in the Court below (the appellants in this Court) in the sum of $483,244.

(2)   Order the respondents to pay the appellants’ costs of the appeal and in the Court below.

Catchwords:

APPEALS — amendment of notice of appeal — where proceedings ought not be remitted to Court below — where appellate court to determine quantum of damages — damages determined on the papers

DAMAGES — measure of damages — misleading or deceptive conduct — where reliance on misleading conduct caused the appellants to agree to a contractual variation — measure of loss or damage suffered as a result of variation — cost of rectification — rectification costs for installation of cladding — reliance on expert quantity surveyor evidence — proportionate liability — whether reduction required under principles of proportionate liability — where respondents bound by case put in court below

Legislation Cited:

Australian Consumer Law (Cth), s 236

Australian Consumer Law (NSW), s 236

Building and Construction Industry Security of Payment Act 1999 (NSW)

Civil Liability Act 2002 (NSW), s 34

Competition and Consumer Act 2010 (Cth), s 87CB, Pt VIA

Design and Building Practitioners Act 2020 (NSW)

Fair Trading Act 1987 (NSW), s 28

Home Building Act 1989 (NSW), s 92

Supreme Court Act 1970 (NSW), s 75A

Cases Cited:

Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184

Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349

Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33

Derek Larsen as Trustee for the Larsen Superannuation Fund v Tastec Pty Ltd ACN 051516682 [2024] NSWDC 518

Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10

Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145

Larsen v Tastec Pty Ltd [2023] NSWCA 39

Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; [1950] HCA 35

University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; [1985] HCA 28

Water Board v Moustakas (1988) 180 CLR 491; [1988] HCA 12

Whisprun v Dixon (2003) 77 ALJR 1598; [2003] HCA 48

Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54

Zervas v Burkitt (No 2) [2019] NSWCA 236

Category:

Principal judgment

Parties:

Derek Larsen as trustee for the Larsen Superannuation Fund (First Appellant)
Floyd Larsen as trustee for the Larsen Superannuation Fund (Second Appellant)
Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (First Respondent)
Stephen Sainsbury (Second Respondent)

Representation:

Counsel:
I G Roberts / D S Allen (Appellants)
M R Gracie / B Dziubinski (Respondents)

Solicitors:
Mills Oakley (Appellants)
Ad Valorem Law (Respondents)

File Number(s):

2024/448106

 Decision under appeal 

Court or tribunal:

District Court

Jurisdiction:

Civil

Citation:

Derek Larsen as Trustee for the Larsen Superannuation Fund & Anor v Tastec Pty Ltd ACN 051516682 [2024] NSWDC 518

Date of Decision:

7 November 2024

Before:

Cole DCJ

File Number(s):

2020/83478

HEADNOTE

[This headnote is not to be read as part of the judgment]

Following the Court’s decision in Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145 on 4 July 2025, the Court permitted the appellants (the Larsens), to amend their notice of appeal to seek an order that this Court determine the quantum of damages. In doing so, the Court declined to remit the assessment of damages to the District Court, thereby avoiding further delay in the resolution of the proceedings.

The parties agreed that the final substantive issue, the quantum of damages recoverable by the Larsens from the respondents, Tastec Pty Ltd and Stephen Sainsbury, arising from their misleading or deceptive conduct, be determined on the papers.

Two principal issues arise for determination. First, the extent of damages to be awarded in respect of the cost of rectifying the Larsens’ residence by the installation of Maxline 340 cladding to the walls and roof. Second, whether that amount should be reduced on the basis of the respondents’ allegation that the builder, Veroc Pty Ltd (Veroc), was proportionately liable for the Larsens’ loss.

The Court (Adamson JA, Stern JA and Price AJA agreeing) held:

Quantum of damages

1. The cost of rectification is $483,244.

Alleged reduction of damages as a result of proportionate liability

1. No basis for reduction on the basis of proportionate liability has been made out: [59].

2. Veroc is not alleged to have played any part in the misleading or deceptive conduct or in procuring the Larsens’ signatures on Variation 6. Once the Larsens had accepted Variation 6, Veroc was obliged to proceed with the construction work on that basis. Veroc was neither obliged nor permitted to install Maxline 340, and to have done so would have been contrary to Variation 6: [46]-[47].

3. Further, the respondents did not make any submissions as to Veroc’s proportionate liability to the primary judge, which were put for the first time on 19 August 2025 in their written submissions on the issue of quantum. In these circumstances, the respondents are bound by the way they put their case in the Courts below and ought not be permitted to depart from it: [53]-[55].

Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349; Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54; Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10; Whisprun v Dixon (2003) 77 ALJR 1598; [2003] HCA 48; Water Board v Moustakas (1988) 180 CLR 491; [1988] HCA 12; University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; [1985] HCA 28; Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33; Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184, considered.

JUDGMENT

1. ADAMSON JA: The dispute between, on the one hand, the appellants, Derek and Floyd Larsen as trustees of the Larsen Superannuation Fund (the Larsens) and, on the other, the respondents, Tastec Pty Ltd (Tastec) and Stephen Sainsbury, has been protracted and involved several proceedings. It is not necessary to repeat this history as it is set out in [2]-[5] of this Court’s judgment delivered on 4 July 2025: Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145 (CA 2).

2. It is sufficient to note that the original proceedings in the District Court (the Court below) were determined by Gibb DCJ (DC 1). This Court in part allowed the Larsens’ appeal against her Honour’s orders: Larsen v Tastec Pty Ltd [2023] NSWCA 39 (CA 1). This Court remitted the determination of the Larsens’ claim for relief under the Australian Consumer Law to the Court below. Their claim was heard and determined by Cole DCJ (the primary judge) who assessed their damages as nil: Derek Larsen as Trustee for the Larsen Superannuation Fund v Tastec Pty Ltd ACN 051516682 [2024] NSWDC 518 (DC 2). This Court allowed the Larsens’ appeal from that decision: CA 2. Rather than remit the assessment of damages to the Court below (as the Larsens initially sought), this Court allowed the Larsens to amend their notice of appeal to seek an order that this Court determine the quantum of damages under s 75A of the Supreme Court Act 1970 (NSW) and granted that order: CA 2, [123]-[125].

3. The present judgment is addressed to the final substantive issue: the quantum of damages to which the Larsens are entitled from Tastec and Mr Sainsbury as a result of the respondents’ misleading or deceptive conduct.

4. The parties are content to have this issue determined on the papers (the Larsens having specifically agreed to it and the respondents not having objected). To that end, they have provided further evidence to the Court, to which no objection has been taken, as well as written submissions.

5. Two principal issues, which will be addressed in turn, arise for consideration:

1. the damages that should be awarded in respect of the cost of rectification of the Larsens residence to install Maxline 340 as cladding over the walls and roof (being the damages they suffered as a consequence of the respondents’ contravening conduct); and

2. whether this amount ought be reduced in accordance with the principles of proportionate liability.

Quantum of damages

6. This Court found that the quantum of damages in the present case is to be assessed as the cost of installing Maxline 340 cladding (Maxline 340) over the Bondor 580 panels (the Bondor panels) on the roof and walls of the Larsens’ residence. The Larsens adduced evidence from engineers, Richard Noonan and Bill Moisidis, as to the way in which the rectification works could be performed. The respondents’ adduced expert evidence from Peter Karsai, who prepared a joint report with Mr Moisidis. Their solution was costed by the parties’ expert quantity surveyors: Mr Bolt (retained by the Larsens) and Dr O’Donnell (retained by the respondents). The Larsens also relied, as corroboration of Mr Bolt’s evidence, on detailed responses from two builders received by the Larsens to their requests for tender. Mr Bolt and Dr O’Donnell relied on their individual reports and also prepared a joint report dated 6 May 2024. They were cross-examined in the hearing before the primary judge.

7. The experts opined as to the cost of rectification works by reference to the cost of the following items:

1. preliminaries and building period;

2. roof cladding and wall cladding;

3. design development; and

4. windows and doors and miscellaneous items.

Matters not in dispute

GST and margins for overheads, profit and contingency

8. The experts agreed that the cost of rectification should be assessed on the assumptions that a builder would charge an overhead and profit margin of 20% of the direct costs of the work; that a contingency of 5% would be allowed on the total amount; and that GST would be payable on all costs, including the builder’s margin and contingency.

No need for the Larsens to vacate their residence

9. It was common ground that the Maxline 340 sheeting could be installed on top of the existing Bondor panels by screwing the attachment brackets (hardwood timber battens to address bushfire risk) into the top layer of the Bondor panels. As a consequence, it was ultimately common ground that there would be no need for the Larsens to vacate their residence when the work was being done (and therefore no allowance for alternative accommodation need be made).

Further design development

10. It was also common ground that, although Mr Sainsbury had already charged the Larsens for design development to accommodate their stipulation of Maxline 340 cladding, further design development would be required to design and detail how the Maxline 340 was to be installed as cladding over the Bondor panels on the roof and walls of the residence. Dr O’Donnell agreed with Mr Bolt’s estimate that the initial drawings done by the respondents amounted to about 20-30% of the detailed design. The cost of the remaining design development (about which the parties were at issue) must be included in the damages awarded to the Larsens.

Cost of Home Building Compensation Fund insurance

11. The parties also agreed that Home Building Compensation Fund insurance would be required (in accordance with the Home Building Act 1989 (NSW), s 92). Mr Bolt calculated $2,834.19 (incl GST) ($2,576.54 (excl GST)) to be the amount of the premium in his attachment to the joint report. I understand that this figure is not disputed.

Replacement of the door assemblies in the dining and living rooms

12. It was ultimately common ground that the rectification works did not require all the windows and doors to be replaced. The rectification method proposed by Mr Moisidis in the joint engineering report was limited, in this respect, to replacement of the door assemblies in the dining and living rooms. The Larsens are content to have their damages assessed on the basis of the figure allowed by Dr O’Donnell for those works of $41,370 as Mr Bolt costed these items on a different basis which the Larsens have since acknowledged was erroneous.

Electrical work

13. The Larsens accepted Dr O’Donnell’s figure for electrical work of $800.

Matters in dispute

14. The difference between the costings of the expert quantity surveyors was, at the conclusion of the hearing before the primary judge, the difference between $526,728.80 (Mr Bolt’s figure) and $277,021.21 (Dr O’Donnell’s figure). However, as a consequence of concessions made on behalf of the Larsens, the figure which they claim has been reduced to $483,244.09 (which includes the builder’s margin of 20%, percentage for contingencies of 5%, the cost of Home Warranty Insurance of $2,576.54 and GST) or $439,312.81 (excluding GST).

15. The differences between Mr Bolt and Dr O’Donnell relate to various categories of cost, which will be addressed in turn.

16. The respondents, having lost their argument that it was inevitable that Variation 6 be agreed to because of the impracticability of installing Maxline 340 over the roof and walls of the residence, submitted that the rectification was “a straightforward over-cladding project over an existing and retained base panel”. On this basis, they submitted that Mr Bolt’s opinion ought be rejected because the amounts claimed on the basis of his evidence were disproportionate to the original contract cost. They advanced Dr O’Donnell’s figures, which were standard rates, on the basis that they were more reasonable than Mr Bolt’s.

17. The purpose of the damages to be awarded to the Larsens is to compensate them for the loss they have suffered as a result of the respondents’ contravening conduct. This Court has found that damages for their loss are to be assessed by reference to the cost of rectification: namely, the cost of installing Maxline 340 cladding on the roof and walls of the Larsens’ residence. The cost is affected by the relative complexity of the task. This cost is higher than had the respondents performed the contract in accordance with its terms and arises because of the respondents’ misleading or deceptive conduct in obtaining the Larsens’ agreement to Variation 6.

18. Further, unlike an adjudicator under the Building and Construction Industry Security of Payment Act 1999 (NSW), this Court does not apply any expertise which it may have to the assessment of building costs since it must act on the evidence adduced by the parties. Accordingly, the reasons set out below as to why particular evidence was accepted reflect the evidence which was before the Court on the issue of quantum, including the concessions made by the experts called by the parties and their methodology in arriving at the figures for various items. The Court also takes account of inconsistencies in the evidence of a witness which may affect the reliability of parts of that witness’s evidence.

Preliminaries and building period

19. Mr Bolt’s description of what “preliminaries” comprise suffices to explain what is covered: “the cost of insurances, supervision, final clean, rubbish removal, scaffolding, temporary protection and site amenities, such as temporary site offices and ablution facilities”. Self-evidently, the cost of preliminaries is affected by, and broadly proportionate to, the length of the building period.

20. Mr Bolt’s figure for preliminaries is $122,881.92 ($11,171 per week, based on a building period of 11 weeks) and Dr O’Donnell’s is $63,413 ($10,569 per week, based on a building period of 6 weeks). Thus the real dispute between the experts as to preliminaries is as to the length of the building period since the difference in the weekly figure is relatively small.

21. Unlike Mr Bolt, Dr O’Donnell did not visit the property but, instead, relied on documentation and photographs. Further, the basis of Dr O’Donnell’s initial assessment of a 6-week building period was not exposed in his report or explained in his oral evidence, as Mr Bolt observed in his response to that report, although some basis was provided in the joint report.

22. Dr O’Donnell’s table of costings indicates that in performing his calculations, he applied a productivity rate of 10m per hour for installing timber battens on the roof and walls and a productivity rate of 10 square metres per hour for cladding the roof and walls. However, when pressed in cross-examination while giving oral evidence concurrently with Mr Bolt at the hearing before the primary judge, Dr O’Donnell said that the rate per square metre for both the roof and the walls was 32 hours per 100 square metres (3.2 hours per 10 square metres). He explained that he calculated this rate by using a Rawlinsons rate of .22 hours per square metre and “bump[ing] it up by a third”. Dr O’Donnell agreed in cross-examination that because the project was “quite a unique project and there [was] no specific Rawlinsons or Cordell’s rate that would apply”, it was necessary to modify whatever rate appeared in those cost guides. However, he maintained that he performed an adjustment by adding a third to the Rawlinsons rate. Dr O’Donnell did not explain how he could reconcile the oral evidence he had given (3.2 hours per 10 square metres) with his evidence in his report of (1 hour per 10 square metres).

23. These matters adversely affect the reliability of Dr O’Donnell’s assessment of the required building period.

24. Mr Bolt applied what he termed a “first principles” approach to the assessment of the cost of rectification. In assessing “a reasonable labour production rate”, he considered “the nature of the work, the methodology and the environment in which the work is to be performed”. His assessment of an 11-week building period is based on his assessment of the tasks required by the rectification works which are identified by category in Appendix 5 to his report. Thus the basis of his opinion is adequately exposed and has not been shown to be unreasonable. Indeed, it gains support from the concessions made by Dr O’Donnell referred to above. It is also corroborated by the responses to tender provided to the Larsens by two builders. In his response, Ben Pirie of Pirie Homes Pty Ltd estimated the building period to be “a minimum [of] 3 months”. Heath Dyer of ProActive Building Solutions estimated that the rectification works would take 14-16 weeks, depending on the weather.

25. For these reasons, I am persuaded that Mr Bolt’s figure of $122,881.92 for preliminaries ought be accepted.

Roof and wall cladding

26. Mr Bolt’s estimate of the cost of cladding the roof was $90,684.04, which comprised $80,734.19 for the cost of installing the cladding and an additional $9,949.85 for the battens, sarking and insulation associated with the roofing work. He estimated the cost of the walling work to be $70,572.25, which comprised $54,866.74 for installing the cladding and an additional $15,705.51 for the battens, sarking and insulation associated with the walling work.

27. Mr Bolt used a material cost for the Maxline 340 of $84.41 per square metre, which was based on a quotation he obtained from Kingstone Industrial Group Ltd in 2020. This figure included not only the sheeting but also the sundry accessories required to install the roofing materials. He compared this figure with another costing which was contained in the materials with which he had been briefed which indicated a price for Maxline 340, as at September 2023, of $72 per square metre. Mr Bolt considered these figures to be consistent as the figure of $84.41 per square metre included accessories but the figure of $72 per square metre did not.

28. In his estimate of the cost of cladding, Dr O’Donnell used a “supply [$62 per square metre] and fix rate” of $80 per square metre, which was said to derive from “Rawlinsons p399 + 1/3^rd”. His estimate for the cost of cladding the roof was $44,883 which comprised $39,333 (Item 1.07 for cladding and insultation, including battens) and $5,550 (Item 1.08 for “[e]dge trims colour matched”).

26. It is apparent from the joint report that Dr O’Donnell’s figure of $80 per square metre is a blended rate which includes materials, $62 per square metre, and labour of $18 per square metre. The figure of $62 per square metre was for generic “colourbond cladding” and did not relate specifically to Maxline 340, which is the basis for the claim for cost of rectification (for reasons given in CA 2). Further, Dr O’Donnell was unable to substantiate the labour cost of $18 per square metre, except to say that the add-on was appropriate, having regard to the remote location and the specifics of the project. He later said that the labour cost was about half the rate of $80 per square metre. Dr O’Donnell accepted that his allowance for the number of hours required was substantially less than that allowed for by Mr Bolt.

27. Dr O’Donnell appears to have adopted an approach which does not take adequate account of the actual cost of the materials which are required to be used for the cladding of the walls and roof (Maxline 340) and was unable adequately to substantiate his allowance for labour. His broad brush approach did not, in my view, take account of the particular difficulties of the project, including the remote location, the fact that the residence would be occupied while the work was being done and the difficulties associated with overcladding in the present case. Indeed, Dr O’Donnell accepted that he had never “come across something where you’re cladding over the top of an existing finished house before”.

28. By contrast, Mr Bolt had a firm foundation for his figure for the cost of materials and estimated the labour costs by reference to individual aspects of the work, which were not addressed by Dr O’Donnell, such as installation of cappings, flashings and trims. I prefer the evidence of Mr Bolt as to the cost of wall and roof cladding.

Design development

32. Mr Bolt estimated the costs of design development would be a total of $27,807.88, comprising $20,307.88 for ‘Engage Architect/Structural Engineer – design’ and $7500 for the construction certificate and approvals in the preliminaries. In arriving at these figures, including estimating the hours required, Mr Bolt applied, as referred to above, his “first principles” approach and based his assessment on his opinion as to how long it would take to do a full survey and produce a full set of drawings. Further, he separately costed a revised construction certificate, which will be required.

33. By contrast, Dr O’Donnell applied a broad brush approach in arriving at his estimate of $10,000 for the construction certificate and the updated design, which he included in the amount for preliminaries (addressed above). Dr O’Donnell explained that his estimate for this item was calculated as 5% of the total cost. This approach appears to be inconsistent with Dr O’Donnell’s evidence that he would “never start this job without having a full design and full detailing of all the claddings” and that the design was only 20-30% complete. Further, it appears that Dr O’Donnell did not regard the figure of $10,000 as covering the cost of obtaining an updated construction certificate or the updated design since these were identified as assumptions which he had made rather than described as matters included in the figure of $10,000.

34. In response to Dr O’Donnell’s figure, Mr Bolt said that he considered a percentage benchmark to be misleading in this context since the design cost for a project which is both complex and relatively small can readily appear disproportionately high when expressed as a percentage of total cost of the work.

35. For the reasons given above in relation to other items, I do not accept Dr O’Donnell’s figures for costing. I accept Mr Bolt’s criticism of a percentage figure being applied to costing to arrive at a figure for a revised construction certificate and an updated design. As Mr Bolt said, in effect, there is no necessary relationship between building costs and design costs, particularly for a small bespoke project. I accept Mr Bolt’s figures for the revised construction certificate and the updated design.

Summary of constituent items comprising damages for the cost of rectification

36. For the reasons given above, I consider that the cost of rectification ought be assessed as follows.

Description of work	Amount
Wall cladding work	$54,866.74
Wall battens/sarking/insulation	$15,705.51
Roof cladding work	$80,734.19
Roofing battens/sarking/insulation	$9,949.85
Replacement of door assemblies in the dining and living rooms	$41,370
Electrical works	$800
Preliminary costs (including $7,500 for revised construction certificate)	$122,881.92
Revised design	$20,307.88
Sub-total	$346,616.09
Overhead and profit (20%)	$69,323.22
Contingency (5%)	$20,796.97
Home warranty insurance	$2,576.54
Total excluding GST	$439,312.82
GST	$43,931.28
Total (rounded, including GST)	$483,244

37. Subject to any deductions in accordance with the principles of proportionate liability, the Larsens are entitled to have their damages assessed in this amount.

Alleged reduction of damages as a result of proportionate liability

38. In their submissions on quantum filed on 19 August 2025, the respondents submitted that their liability to the Larsens for damages ought be reduced on the basis that Veroc Pty Ltd (Veroc) is a concurrent wrongdoer within the meaning of s 87CB(3) in Part VIA of the Competition and Consumer Act 2010 (Cth). To be a concurrent wrongdoer, the putative wrongdoer must be a person who is or may have been liable for the damage or loss: Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54 at [83] and [91]-[95] (Basten JA, Meagher and Payne JJA agreeing), Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10 at [91] (Bell and Gageler JJ).

39. The genesis of the respondents’ submission as to proportionate liability appears to be the allegation in the respondents’ defences (paragraphs 34 and 35 of Tastec’s defence and paragraph 13 of Mr Sainsbury’s defence) that:

[Veroc] was the licensed builder for the works (licence no 18241C) and also the holder of the compulsory Home Building Compensation Fund (HBCF) insurance (certificate no 19024480) and is a concurrent wrongdoer within the meaning of Part VIA of the [Competition and Consumer Act 2010 (Cth)].

40. The respondents’ defences do not elaborate on the basis for this allegation, which is repeated in each of the paragraphs identified at [39]. No basis is pleaded for the allegation that Veroc is a wrongdoer.

41. In their written submissions on the issue of quantum filed in this Court on 19 August 2025, the respondents articulated the following basis for their defences of proportionate liability.

42. First, they submitted, that “Gibb DCJ found that Veroc was a concurrent wrongdoer in respect of any defective work claimed against Tastec.” In the proceedings before Gibb DCJ, the Larsens claimed against the respondents damages for breach of contract and for misleading or deceptive conduct. Her Honour rejected the contract claim. However, her Honour said, in the alternative:

Against the possibility that I am wrong in that conclusion, I have considered the plaintiff’s claim on the (in my view wrong) hypothesis that the Larsen Superannuation Fund was the contracting party through its trustees in November 2018.

No complaint is made about any failure to supply all required Ecoshelta parts or supervision of its assembly, except to the extent that any defect alleged is the product of defective building work by the builder. If that be so, to the extent that the plaintiffs’ claim is made out it simultaneously makes out the defendants’ assertion of a concurrent wrongdoer as pleaded in paragraphs 34 and 35 of the defence to the amended statement of claim, in particular:

34. In further answer to the allegations in the ASOC that the first defendant breached any common law and/or statutory duty of care under the DBP Act, the first defendant says that those claims are an apportionable claim within the meaning of Part 4 and section 34 of the Civil Liability Act 2002 (CLA) and in respect of which Veroc Pty Ltd was the licenced builder for the works (licence no 182431C) and also the holder of the compulsory Home Building Compensation Fund (HBCF) insurance (certificate no 19024480) and is a concurrent wrongdoer within the meaning of Part 4 of the CLA.

(Emphasis added.)

43. This submission must be rejected. The emphasised portion does not amount to a finding that Veroc was a concurrent wrongdoer. Rather, it is a summary of the way the respondents pleaded the aspect of their defence relating to proportionate liability. The basis of her Honour’s understanding of the way in which the respondents put it was, apparently, limited to their pleaded defence.

44. Secondly, the respondents relied on submissions made in this Court in the hearing which led to CA 2 as to the sequence of events in May and June 2019. At that hearing, the respondents relied on these events in support of ground 3 of their notice of contention (which related to causation and mitigation and did not include any submission alleging that Veroc was a concurrent wrongdoer).

45. Thirdly, the respondents submitted that Veroc was wholly or mainly (alleging that a reduction of 90% in their liability was warranted) responsible for the Larsens’ loss on the following basis:

1. if Veroc had complied with the Stop Work Order issued by the Lithgow City Council (the Council) on 27 May 2019 (which was lifted on 26 June 2019), it remained possible for Tastec to procure Maxline 340 (paragraph 23 of respondents’ submissions filed 19 August 2025);

2. Veroc contributed to the aesthetic or physical mismatch of the cladding by installing, integrating and finalising the non-conforming cladding works (paragraph 23 of respondents’ submissions filed 19 August 2025);

3. Veroc was responsible for failing to warn the Larsens of aesthetic discrepancies (paragraph 22 of respondents’ submissions filed 19 August 2025);

4. Veroc should not have undertaken any interior work after lock-up of Tastec’s work until it directed the installation of the Maxline 340 to comply with the construction certificate drawings (paragraph 25 of respondents’ submissions filed 19 August 2025);

5. the interior work performed by Veroc substantially increased the costs of rectification (paragraph 15 of respondents’ submissions filed 19 August 2025);

6. the Larsens or Veroc misled the Council as the Principal Certifying Authority (paragraph 26 of respondents’ submissions filed 19 August 2025) if the Larsens remained entitled to the Maxline 340 cladding; and

7. as the builder, Veroc was responsible under the Home Building Act to ensure that any work complied with the contract specifications and the construction certificate (paragraph 28 of the respondents’ submissions filed 19 August 2025).

No concurrent wrongdoing as a matter of fact and law

46. As a consequence of the respondents’ misleading or deceptive conduct, the Larsens agreed to Variation 6, the legal effect of which was (subject to their claim for relief under the Australian Consumer Law) that they forewent their right to have the building contract performed in accordance with its original terms which required the installation of Maxline 340 cladding over the panels on the walls and roof of their residence and instead agreed to the installation of Bondor Shademaster Extraline 294 composite SIPS panels. As this Court has found (in CA 1 and CA 2), their damages are to be assessed by reference to the cost of rectification: namely, the cost of installing Maxline 340 on the walls and roof of their residence, this being the position they would have been in but for the misleading or deceptive conduct. Veroc is not alleged to have played any part in the misleading or deceptive conduct or in procuring the Larsens’ signatures on Variation 6. Once the Larsens had accepted Variation 6, Veroc was obliged to proceed with the construction work on that basis.

47. In these circumstances, the short answer to the respondents’ submissions in support of their contention as to concurrent liability is that the Larsens signed Variation 6 on 24 May 2019, before the Council issued its Stop Work Order on 27 May 2019, before the conduct by Veroc which is now contended to ground concurrent liability and before the Council certified the works as complying with the construction certificate. Veroc, as the builder with possession of the site, was neither obliged nor permitted to install Maxline 340 and, had it done so, it would have acted otherwise than in accordance with Variation 6. Indeed, the respondents appear to have accepted this as they relied at trial (as is evident from their written submissions before Gibb DCJ extracted below) on the evidence of Mr Cover, the principal of Veroc, that he did not clad the Bondor panels with Maxline 340 because Variation 6 had been signed before the commencement of works. Further, given the Larsens’ agreement to Variation 6, it is far from clear on what basis the respondents contend that Veroc had a duty to warn the Larsens about the (by then) contractually specified Custom Bondor Shademaster Extraline 294 composite SIPS panels.

48. In these circumstances, the respondents have failed to establish any arguable basis on which Veroc could be said to be a concurrent wrongdoer with Tastec within the meaning of Part VIA of the Competition and Consumer Act or a concurrent wrongdoer with Mr Sainsbury within the meaning of s 236 of the Australian Consumer Law (NSW), for the loss the Larsens suffered as a result of the respondents’ misleading or deceptive conduct.

49. This is sufficient to dispose of the respondents’ submission that the respondents’ liability to the Larsens ought be reduced on the basis of Veroc’s liability (since none has relevantly been established).

No arguable basis for allegation that Veroc is a concurrent wrongdoer having regard to the way the case was conducted in the Court below

50. There is a further, independent reason why the claim cannot be maintained, having regard to the way in which the respondents conducted their case before Gibb DCJ and before the primary judge. In determining whether a party is raising a new point on appeal, regard must be had to the way in which the case was conducted: Whisprun v Dixon (2003) 77 ALJR 1598; [2003] HCA 48 at [52] (Gleeson CJ, McHugh and Gummow JJ), following Water Board v Moustakas (1988) 180 CLR 491 at 496-497 (Mason CJ, Wilson, Brennan and Dawson JJ); [1988] HCA 12.

The way in which the allegation that Veroc was a concurrent wrongdoer was litigated at first instance

51. As already explained, the respondents’ defences do not articulate the basis for the allegation that Veroc was a concurrent wrongdoer in a sense presently relevant.

52. In their reply submissions filed in this Court on 3 September 2025, the respondents extracted parts of their closing written submissions to Gibb DCJ:

[46]    This aspect of the Larsens case by contending non-compliance with the BCA in respect of a single building component supplied by Tastec rather than the “as constructed” walls and roof, has been brought against the wrong party. (2022 Black 1/79: U-W)

…

[85]    The evidence of Mr Cover [the principal of Veroc] raises the most serious issues in respect of the Larsens’ case. It is clear from the evidence of Mr Cover that he did not undertake certain works having regard to the changes that were brought about by variation 6 which was signed prior to the commencement of the works and removed the Maxline 340 cladding over the SIPS. He states that he undertook his works on the “impression” (T278:40) or expectation “that it’d eventually be cladded”: T279:5. No one told him that the project was not going to have that extra cladding over the structure: T278: 21. (2022 Black 1/93:T-X)

…

[101]    There can be no doubt that the Contract between Tastec and the Larsens clearly delineated the works for which Tastec was responsible in terms of the supply and supervision of the assembly of the Ecoshelta panels and glazing. All the works before the site assembly of the Ecoshelta parts and after lock-up were clearly the responsibility of Veroc, as the Schedule of Works (Schedule 4) of the Tastec Contract also makes clear and as Mr Cover acknowledged in a text to Mr Sainsbury on 12 September 2019 in which Mr Cover stated: I am responsible for the entirety of this build and Derek and Floyd have definitely made me aware of this… (affidavit in reply para [53]) (2022 Black 1/98: S-X).

53. As is apparent, before Gibb DCJ, counsel for the respondents confined the allegation of concurrent wrongdoing to the Larsens’ claim (which was not successful) that the respondents had breached the Design and Building Practitioners Act 2020 (NSW). None of the respondents’ submissions before Gibb DCJ bore on Veroc’s liability for the loss suffered by the Larsens as a result of the respondents’ misleading or deceptive conduct. The respondents did not make any submissions as to proportionate liability to the primary judge. Accordingly, no question relating to proportionate liability was before this Court when it heard the appeal which resulted in CA 1. As the Larsens correctly submitted, the respondents’ case on this appeal was that they had not caused the Larsens’ loss because, first, it was inevitable that the Larsens would have had to vary the contract in order to obtain “an achievable and feasible solution”; and, secondly, the Larsens could have objected, but did not object, to the installation of the Bondor panels when they became aware of the misleading conduct.

The contentions now advanced as to proportionate liability

54. The respondent’s contentions, as summarised at [45] above (apart from (7), which was put to Gibb DCJ in the submissions extracted above but which for the reasons set out above, can be put to one side having regard to Variation 6) were put for the first time on 19 August 2025 in their written submissions to this Court on the issue of quantum.

55. In these circumstances, the respondents are bound by the way they put their case in the Courts below and ought not be permitted to depart from it: University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483 (Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ); [1985] HCA 28; Coulton v Holcombe (1986) 162 CLR 1 at 7-8 (Gibbs CJ, Wilson, Brennan and Dawson JJ); [1986] HCA 33; Whisprun at [51]; Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349 at [39] (Gageler CJ, Gordon, Edelman, Steward and Beech-Jones JJ). The limited exception to this fundamental principle is confined to matters of law which could not be affected by evidence (Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438 (Latham CJ, Williams and Fullagar JJ); [1950] HCA 35). The exception has no application in the present case.

56. That the allegation that Veroc was a concurrent wrongdoer was made in general terms in the respondents’ defences is insufficient, in light of the matters set out above as to the manner in which the case was conducted before both Gibb DCJ and the primary judge, to entitle the respondents to put their case on the basis now sought.

57. In Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184, this Court (Meagher, Payne and Brereton JJA), at [26]-[30] held that the “critical integers” of a person being a “concurrent wrongdoer” must be pleaded. These integers are: the identification of a person whose acts or omissions caused the loss or damage the subject of the claim; the alleged acts or omissions; and their causal connection with the damage or loss the subject of the claim. The Court said at [30]:

Text and context requires that a defendant seeking to rely on a proportionate liability defence must plead that claim with the same degree of particularity as if bringing a cross-claim against the alleged concurrent wrongdoer, setting out the relevant material facts. It is not sufficient merely to identify a class of persons one or more of whom may be a concurrent wrongdoer or wrongdoers.

58. Of these three, the respondents in the present case pleaded only the first. They identified Veroc as a concurrent wrongdoer but failed to identify any wrongful acts or omissions and failed to articulate any causal connection between such (unidentified) acts or omissions and the loss suffered by the Larsens. Even on the most expansive reading of the respondents’ defences, the only claim potentially identified against Veroc is a claim under the Home Building Act for breach of warranty that the work would be done in accordance with the contract. This does not assist the respondents since Veroc’s obligations to conduct building work corresponded with Tastec’s obligations to the Larsens and, as explained above, once Variation 6 was agreed upon, Maxline 340 was no longer to be installed as cladding on either the roof or the walls.

Conclusion

59. For these several reasons, the respondents have failed to establish that there ought be any reduction in the quantum of damages for which they are liable to the Larsens.

Other matters

60. I note for completeness that the Australian Consumer Law, which is in Sch 2 of the Competition and Consumer Act, operates as a law of the Commonwealth (of its own force) and, by reason of local law, a law of the various States and Territories. Mr Sainsbury’s liability to the Larsens arises under s 236 of the Australian Consumer Law (NSW), which applies by reason of s 28(1) of the Fair Trading Act 1987 (NSW): see Bell P’s analysis in Zervas v Burkitt (No 2) [2019] NSWCA 236 at [51]-[60]. Thus, the proportionate liability provisions which apply to Mr Sainsbury are to be found in Part 4 of the Civil Liability Act 2002 (NSW). Tastec’s liability to the Larsens arises from s 236 of the Australian Consumer Law (Cth), which applies to the conduct of corporations, and the applicable proportionate liability provisions are those in Part VIA of the Competition and Consumer Act. These matters do not affect the result in the present appeal since the respondents cannot, for the reasons given above, establish that Veroc is a concurrent wrongdoer.

61. In their written submissions filed on 19 August 2025, the respondents have sought to cavil with this Court’s findings in CA 2. These findings have been made and will not be revisited. The only remaining substantive issue in the proceedings following the delivery of CA 2 is the quantum of damages to which the Larsens are entitled, as addressed above. Accordingly, no consideration will be given to the respondents’ submissions which seek to challenge this Court’s findings. Nor will substantive consideration be given to the counterfactual relied on by the respondents in support of their submission that had Veroc installed Maxline 340 as at 18 June 2019 the cost of installation would have been $23,948.12. For the reasons given in CA 2, the relevant counterfactual for the purposes of assessing damages in the present case for misleading or deceptive conduct is the position the Larsens would have been in but for their agreement to Variation 6.

Proposed orders

62. For the reasons given above, I propose the following orders:

1. Judgment for the plaintiffs in the Court below (the appellants in this Court) in the sum of $483,244.

2. Order the respondents to pay the appellants’ costs of the appeal and in the Court below.

63. STERN JA: I agree with Adamson JA.

64. PRICE AJA: I agree with Adamson JA.

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Decision last updated: 12 September 2025