OWNERS UNITS PLAN NO. 2735 & MADISON CONSTRUCTIONS PTY LTD and TOTAL OUTDOOR LIVING CONCEPTS (Civil Disputes)

Owners Corporation Units Plan No. 2735 sought redress for water leakage issues in a Manuka strata complex. The leakage, originating from vergolas installed on the balconies of units 7 to 10 in 2004, led to significant damage to the building's rendering and associated structures. Madison Constructions Pty Ltd, the project manager, and Total Outdoor Living Concepts Pty Ltd, the contractor responsible for the vergolas, were identified as the primary respondents in this civil dispute.

The legal issues before the court included the identification of liability for the defective work, the applicability of statutory warranties under the Building Act 2004, and the consequences of Madison Constructions' acceptance of responsibility for the defects. Additionally, the court had to determine whether Madison Constructions could be held liable for interfering in the contractual relationship between the Applicant and the Second Respondent.

The tribunal ruled that the leaking balcony issue was due to the defective installation by Total Outdoor Living Concepts Pty Ltd, who had punctured the waterproofing membrane during the vergola support pole installation. The tribunal found Madison Constructions liable for the leakage issue due to their acceptance of responsibility for the defects, despite not being the legal entity responsible for the work. Madison Constructions was held liable for gratuitously accepting responsibility and for interfering with the contractual rights of Total Outdoor Living Concepts Pty Ltd. The tribunal apportioned the liability for the $10,000 rectification costs equally between Madison Constructions and Total Outdoor Living Concepts Pty Ltd.

The final orders required the First Respondent to pay $5,000 within 28 days, and the Second Respondent to pay $5,000 within 90 days, in full and final satisfaction of all claims arising from the water leakage caused by the installation of the vergolas.