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Shaw v Yarranova Pty Ltd

Shaw v Yarranova Pty Ltd

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Case Copied 23 February 2006 43 min read

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IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

No. 9046 of 2003

JOHN RASHLEIGH SHAW

Plaintiff

YARRANOVA PTY LTD (ACN 077 517 616)

and

NEWQUAY STAGE 2 PTY LTD (ACN 086 482 644)

First defendant

Second defendant

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JUDGE:	BELL J
WHERE HELD:	Melbourne
DATE OF HEARING:	9, 13-15, 21 February 2006
DATE OF JUDGMENT:	23 February 2006
CASE MAY BE CITED AS:	Shaw v Yarranova Pty Ltd
MEDIUM NEUTRAL CITATION:	[2006] VSC 45

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CONTRACT – sale by developer of apartment in proposed multi-storey residential development – “off the plan” – whether covered by Domestic Building Contracts Act 1995 – whether “domestic building contract” - ”major domestic building contract” – “domestic building work” – “builder” – ss. 3(1), 5(1), 8, 9, 29, 42, Parts 2 and 3 – Building Act 1993 – ss. 137E(a), 170.

STATUTORY INTERPRETATION – considering meaning of words in statutory context at first instance.

PRECEDENT – stare decisis – decision of single judge of same superior court – when not followed – Supreme Court of Victoria.

APPEARANCES:	Counsel	Solicitors
For the plaintiff	Mr Craig Harrison	Rigby Cooke
For the defendants	Mr Anthony Kelly	Arnold Bloch Liebler

HIS HONOUR:

INTRODUCTION

By a contract of sale dated 12 April 2000 John Shaw bought an apartment in the Boyd Tower in the Docklands from Yarranova Pty Ltd, a developer. Yarranova later assigned its interests in the contract to NewQuay Stage 2 Pty Ltd. Thereafter, NewQuay stood in the shoes of Yarranova.

Mr Shaw bought the apartment “off the plan”. Therefore, in the contract of sale, the apartment was depicted in a plan for a building project that Yarranova was developing, not in a plan for an actual building. Whether the building would be built depended, for example, on whether the project attracted enough buyers to be commercially viable.

The project did attract enough buyers so it went ahead. By a contract dated 15 December 2000, NewQuay engaged Bovis Lend Lease Pty Limited, a registered builder, to design and construct the building, which it did over the next year or so.

In July 2002, NewQuay called on Mr Shaw to complete the contract of sale by paying the balance of the purchase price. Mr Shaw refused to do so because, he alleged, the apartment had not been constructed in accordance with the plans and specifications in the contract of sale and it had. NewQuay disputed these allegations and insisted on completion.

When Mr Shaw would not complete, NewQuay served a notice of default and rescission on him. This happened in September 2003. Mr Shaw still refused to complete. In consequence, so submit Yarranova and NewQuay, the contract of sale is at an end and Mr Shaw has forfeited his deposit. According to the companies, Mr Shaw has lost the apartment and his money.

Mr Shaw’s position is that the companies were bound by the provisions of the Domestic Building Contracts Act 1995. Section 42 prohibits a builder from demanding final payment under a…

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.

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Details

Case: [2006] VSC 45
Decision Date: 23 February 2006

CaseChat Overview and Summary

The case of Shaw v Yarranova Pty Ltd involved a dispute between a purchaser and a developer over the sale of an apartment in a proposed multi-storey residential development. The apartment was sold "off the plan" and the primary issue was whether the transaction was covered by the Domestic Building Contracts Act 1995 (Vic). Specifically, the court had to determine if the sale constituted a "domestic building contract", and if so, whether it qualified as a "major domestic building contract" under the Act. Additionally, the court needed to interpret the meaning of terms such as "domestic building work" and "builder" within the statutory context.

The court examined the statutory provisions of the Domestic Building Contracts Act 1995, including sections 3(1), 5(1), 8, 9, 29, 42, and Parts 2 and 3, alongside the Building Act 1993. The court also considered relevant precedent, particularly the decision of a single judge of the Supreme Court of Victoria. The court found that the sale of the apartment did not constitute a "domestic building contract" as defined in the Act, and therefore did not fall within the scope of the statutory protections provided for in the Act. The court's interpretation of the statutory terms was informed by the context in which they were used, and the court did not follow the previous decision of the single judge, exercising its discretion under the doctrine of stare decisis.

In light of the court's findings, the sale of the apartment was not covered by the Domestic Building Contracts Act 1995, and the developer was not subject to the obligations and requirements imposed by the Act. The court's decision provides guidance on the interpretation of statutory terms in the context of building contracts and the application of the doctrine of stare decisis in the Supreme Court of Victoria. The court's orders reflected its findings and conclusions on the issues before it, providing clarity for both parties and future litigants in similar cases.

Orders