JUDGE:	Cavanough J
WHERE HELD:	Melbourne
DATE OF HEARING:	1-2 June 2017
DATE OF JUDGMENT:	19 March 2018
CASE MAY BE CITED AS:	Mann v Paterson Constructions Pty Ltd
MEDIUM NEUTRAL CITATION:	[2018] VSC 119 Second Revision: 21 March 2018

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RESTITUTION – Work and labour done – Building contract – Wrongful repudiation accepted by builder – Quantum meruit as alternative to contract damages – Measure of value – Relevance of contract price – Relevance of builder’s actual costs – Undocumented variations to scope of works – Whether such variations affect quantum meruit claim by virtue of Domestic Building Contracts Act 1995 s 38.

ADMINISTRATIVE LAW – Appeal from VCAT on questions of law – Whether VCAT erred in law in calculating quantum meruit for building work – No error of law – Appeal dismissed – Victorian Civil and Administrative Tribunal Act 1998 s 148.

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr T Margetts QC with Mr G Hellyer	Telford Story & Associates
For the Respondent	Mr A Laird	Kalus Kenny Intelex

HIS HONOUR:

In 2014 the applicants, Peter and Angela Mann, wanted to have two units built on land they owned in Blackburn. One unit would be for renting out as a residential investment property and the other would be for them and their children to live in. In March of that year, the Manns entered into a standard form written contract with the respondent, Paterson Constructions Pty Ltd (‘PCPL’), for the construction of the two units. PCPL is a ‘one man company’. It is owned and operated by Mr Stephen Paterson, who is an experienced builder and someone who turns his hand to the work of many different building trades. The building contract was subject to the Domestic Building Contracts Act 1995 (‘the Act’) (as in force in March 2014), being a ‘major domestic building contract’ within the meaning of the Act.

By March 2015 the investment unit had been virtually completed and the home unit was quite close to completion. However, a dispute had arisen between the Manns and PCPL over moneys claimed and other things. The Manns purported to terminate the building contract and to exclude PCPL from the site. By letters from their respective solicitors, the parties accused each other of wrongful repudiation of the contract.

PCPL commenced a proceeding against the Manns in the Building and Property List of the Victorian Civil and Administrative Tribunal (VCAT), invoking VCAT’s jurisdiction under Subdivision 1 (‘Domestic Building Disputes’) of Division 2 of Part 5 of the Act (as it stood in 2015). The Manns lodged a counterclaim in the same proceeding.

In 2016 the proceeding came before Senior Member Walker for hearing. Many issues were raised. The hearing ran for over three weeks. On 12 December 2016 Senior…

Grounds of appeal

[14] The appellant contends that the primary judge erred in finding that the respondent had discharged the onus of establishing the matters required under the relevant provision.

[15] It was submitted that his Honour failed to give adequate weight to the evidence of the second witness, and that the findings of fact were not reasonably open on the material before the Court.

[16] The respondent, for its part, submits that no error is disclosed, and that the conclusions reached were well within the range of outcomes available to the primary judge.

Consideration

[17] It is convenient to deal first with the question of construction, as the resolution of that issue informs the remaining grounds advanced by the appellant.

[18] For the reasons that follow, we are of the view that the appeal should be allowed in part and the matter remitted for further determination.

Continue reading Mann v Paterson Constructions Pty Ltd

Details

AGLC: Mann v Paterson Constructions Pty Ltd [2018] VSC 119
Case: [2018] VSC 119
Decision Date: 19 March 2018

CaseChat Overview and Summary

In the case of Mann v Paterson Constructions Pty Ltd, the dispute arose between the plaintiffs, Mr and Mrs Mann, and the defendant, Paterson Constructions, regarding the construction of a residential building. The Manns engaged Paterson Constructions under a building contract to construct their home. However, the relationship soured, and Paterson Constructions wrongfully repudiated the contract. The Manns accepted this repudiation and sought compensation through a claim for restitution, specifically quantum meruit, as an alternative to seeking damages under the contract. The central issue was the measure of quantum meruit, particularly whether it should be calculated based on the contract price, the builder's actual costs, or some other basis, and whether undocumented variations to the scope of works affected the calculation.

The court had to determine how quantum meruit should be assessed in this context, taking into account the relevant provisions of the Domestic Building Contracts Act 1995, particularly section 38. This section specifies that the court should consider the value of the work done in determining quantum meruit claims in domestic building contracts. The court examined whether the variations, which were not documented in the contract, should influence the calculation of the quantum meruit. Given that the variations were integral to the work performed, the court found that they needed to be considered in determining the overall value of the work completed.

The court concluded that the tribunal did not err in its assessment of quantum meruit. It determined that the tribunal had correctly considered the value of the work done, taking into account the variations, in line with the statutory requirements. The court found no legal error in the tribunal's approach and dismissed the appeal. Consequently, the original decision of the tribunal, which set the quantum meruit based on the work performed and its value, was upheld.

The final orders of the court were to dismiss the appeal, affirming the decision of the tribunal. The tribunal's calculation of quantum meruit was found to be legally sound, and no further appeal was permitted under section 148 of the Victorian Civil and Administrative Tribunal Act 1998.

Orders