Mrocki v Mountview Prestige Homes Pty Ltd

SUPREME COURT OF VICTORIA

COURT OF APPEAL

S APCI 2011 0014

LEON MROCKI & ANOR	Applicants
v
MOUNTVIEW PRESTIGE HOMES PTY LTD (ACN 092 818 669)	Respondent

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JUDGES	HARPER JA and KYROU AJA
WHERE HELD	MELBOURNE
DATE OF HEARING	9 March 2011
DATE OF JUDGMENT	18 March 2011
MEDIUM NEUTRAL CITATION	[2011] VSCA 73
JUDGMENT APPEALED FROM	Mrocki v Mountview Prestige Homes Pty Ltd [2010] VSC 624 (Dixon J)

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APPLICATION FOR LEAVE TO APPEAL – Application made pursuant to s 17A(3A)(a) of the Supreme Court Act 1986 – Judge in the Trial Division allowed an appeal from a decision of the VCAT, but refused to remit the proceeding because the claim was bound to fail – Construction of contract in the form of an amended Housing Industry Association ‘cost plus’ contract – Contract related to construction of apartment building – Defects in completed building – Judge held that the ‘Building Works’ for which the builder was responsible under the contract were confined to the provision of contract management services and that the contractual warranties applied only to those services – Application granted.

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr I D Martindale SC with Mr R N Cameron	Fetter Gdanski
For the Respondent	Mr N McPhee	Neil McPhee & Associates

HARPER JA
KYROU AJA:

Introduction and summary

1. This is an application pursuant to s 17A(3A)(a) of the Supreme Court Act 1986 for leave to appeal from a decision of a judge in the trial division of this Court (Dixon J).[1]  His Honour allowed an appeal from a decision of the Victorian Civil and Administrative Tribunal (‘VCAT’) which dismissed a claim made by Leon Mrocki and Harry Mrocki (‘Owners’) against Mountview Prestige Homes Pty Ltd (‘Builder’) in respect of defects in two luxury apartments that were built in a two-storey building at Lot 27, St Ninians Road, Brighton.  However, his Honour refused to remit the proceeding to the VCAT on the basis that the Owners’ claim was bound to fail.

   [1]Mrocki v Mountview Prestige Homes Pty Ltd [2010] VSC 624 (22 December 2010) (‘Reasons’).

1. The dispute between the Owners and the Builder arose out of a written agreement that they executed on 30 November 2006 in respect of the construction of the apartments (‘Agreement’).  The apartment building incorporated a shared basement and two swimming pools. 

1. Pursuant to the Agreement, the Owners agreed to pay to the Builder a fixed fee of $247,500 and to pay directly all tradespeople and suppliers of materials (collectively, ‘contractors’).  The apartments were built at a cost of over $5 million.  There were many defects, including water leaking from the swimming pools into the apartments.  The causes of some of the defects were unclear.  The Owners’ claim against the Builder was under the warranties in cl 11 of the Agreement. 

1. The VCAT found that the Agreement was void for uncertainty.  It also decided that the Builder’s obligation to the Owners was to supervise the building project with reasonable care and skill, rather than…