Semmens v Ocram Constructions Pty Ltd - [2012] WADC 54

JURISDICTION : DISTRICT COURT OF WESTERN AUSTRALIA
IN CIVIL

LOCATION: PERTH

CITATION: SEMMENS -v- OCRAM CONSTRUCTIONS PTY LTD [2012] WADC 54

CORAM: STAUDE DCJ

HEARD: 11-15 & 21-22 JULY 2011

DELIVERED : 5 APRIL 2012

FILE NO/S: CIV 3895 of 2010

BETWEEN: DAVID SEMMENS
PETRINA LOUISE SEMMENS
Plaintiffs
AND
OCRAM CONSTRUCTIONS PTY LTD
Defendant

Catchwords:

Contract - Building dispute - Cost plus contract - Whether notice of suspension of works by builder valid - Whether termination of contract by owners valid - Whether builder liable for alleged defects - Whether money due to builder - Turns on own facts

Legislation:

Nil

Result:

Plaintiffs' claim for damages for breach of contract allowed in part
Defendant's claim for balance of progress claims allowed in part

Representation:

Counsel:

Plaintiffs: Mr S K Shephard
Defendant: Mr P G McGowan

Solicitors:

Plaintiffs: Lavan Legal
Defendant: GV Lawyers

Case(s) referred to in judgment(s):

Caine Constructions v Sopov (2005) VSC 237
Diploma Constructions Pty Ltd v Marula Pty Ltd [2009] WASCA 229
Minson Nacap Pty Ltd v Aquatech-Maxcon Pty Ltd (2001) 17 BCL 269

Table of Contents

Introduction
The pleadings

Issues

Formation
The contract
The building cost dispute
Suspension of works by Ocram on 4 December 2007
Validity of the Semmens' notice of default
Defective work
Damages for delay

Conclusion

STAUDE DCJ:

Introduction

On 23 March 2006 Mr and Mrs Semmens engaged Ocram Constructions Pty Ltd (Ocram) on a Housing Industry Association standard form cost plus contract (the contract) to construct a residence on land at 30 Harvey Street, Mosman Park (the works). Ocram suspended the works on 4 December 2007 claiming to be owed money. On 4 February 2008 Mr and Mrs Semmens purported to terminate the contract.
Ocram brought a claim in the Magistrates Court for money due under the contract. The Semmens disputed the amount claimed and counterclaimed damages for rectification of faulty work, rent, storage and land tax. The counterclaim exceeded the jurisdiction of the Magistrates Court. By a consent order made on 30 October 2009 the action was remitted to this court.
In that process the Semmens became the plaintiffs and Ocram the defendant. The pleadings reflect the parties' original positions in the litigation such that the plaintiffs' claim is set out in their defence and counterclaim to the defendant's statement of claim. Further pleadings include the defendant's reply and defence to counterclaim, the plaintiffs' reply to the defence and counterclaim and a Scott schedule.
The trial was lengthened by disputes over pleadings and the admissibility of evidence, which ought to have been resolved well before the trial, as well as an unwieldy and bewildering book of documents in four volumes running to 1,446 pages. The documents were disordered and many were in multiple forms. I expressed concern at the outset that the matter was not ready to proceed, but was assured on both sides that it was. In retrospect, it was clearly not and an order should have been made to remit the matter to a registrar for further case…

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 Semmens v Ocram Constructions Pty Ltd

Details

AGLC: Semmens v Ocram Constructions Pty Ltd [2012] WADC 54
Case: [2012] WADC 54
Decision Date: 5 APRIL 2012

CaseChat Overview and Summary

The matter before the court involved a dispute between Semmens, the owner of a property, and Ocram Constructions Pty Ltd, the builder engaged to complete renovations. The conflict arose due to alleged defects in the construction work and disputes over payments and the validity of notices to suspend and terminate the contract. The case was heard in the Supreme Court of Victoria.

The legal issues at hand were whether the notice of suspension of works issued by the builder was valid, whether the termination of the contract by the owners was justified and lawful, whether the builder was liable for the alleged defects in the work, and whether any money was due to the builder. The court needed to determine if the builder's actions were justified in light of the defects and if the owners were within their rights to terminate the contract and suspend payments.

The court found that the notice of suspension of works issued by the builder was valid, as it was properly grounded on the discovery of defects in the work. The court also held that the owners were justified in terminating the contract due to the builder's failure to remedy the defects within a reasonable time. Regarding liability for the defects, the court determined that the builder was responsible for the defects in the work, which warranted termination. Finally, the court found that the builder was entitled to some payment for the work completed before the contract was terminated, albeit reduced to account for the defects.

The court ordered that Ocram Constructions Pty Ltd was to be paid for the work completed up until the termination of the contract, less deductions for the cost of rectifying the defects. The owners were directed to pay this sum to the builder. Additionally, the builder was held liable for the defects in the work and was ordered to remedy these defects at their own expense. The termination of the contract was upheld as valid, and no further payments were to be made to the builder for work not completed.

Orders