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Stephens v Cameron

Stephens v Cameron

Case [2021] VSCA 208 30 July 2021

Contract Formation

Unjust Enrichment

Statutory Construction

Compensatory Damages

Limitation Periods

Contract Law

Statutory Interpretation

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SUPREME COURT OF VICTORIA

COURT OF APPEAL

S EAPCI 2021 0031

LUCAS STEPHENS	Applicant
v
PAUL CAMERON	First Respondent
- and -
JOSEPH ALESCI	Second Respondent

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JUDGES:	KYROU, McLEISH and NIALL JJA
WHERE HELD:	MELBOURNE
DATE OF HEARING:	15 June 2021
DATE OF JUDGMENT:	30 July 2021
MEDIUM NEUTRAL CITATION:	[2021] VSCA 208
JUDGMENT APPEALED FROM:	[2021] VCC 127 and County Court of Victoria, 11 March 2021 (Judge Woodward)

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BUILDING AND CONSTRUCTION – Major domestic building contracts – Contract for management of construction of two townhouses – Owners contracted with registered builder, who engaged trade contractors – Substantial amounts paid to builder for incomplete works – Whether contract a ‘domestic building contract’ for purposes of Domestic Building Contracts Act 1995 – Whether implied criterion of ‘responsibility’ limiting application of Domestic Building Contracts Act to contracts with persons responsible for works – No implied criterion – Contract for managing and arranging carrying out of construction of home a ‘domestic building contract’ – Whether applicant not a ‘builder’ for purposes of Domestic Building Contracts Act because respondents ‘owner-builders’ for purposes of Building Act 1993 – Respondents not ‘owner-builders’ – Applicant treated as builder for statutory building permit and insurance requirements – Concept of ‘owner-builder’ irrelevant to characterisation under Domestic Building Contracts Act – Leave to appeal refused – Domestic Building Contracts Act1995 ss 1, 3–5, 8, 29, 31, 132–3, Building Act 1993 24A, 25E, 135–6, 137B.

STATUTORY CONSTRUCTION – Whether s 40(2) of Domestic Building Contracts Act creates statutory entitlement to repayment of amounts retained by builder above prescribed progress payment limits – Imerva Corporation Pty Ltd v Kuna [2017] VSCA 168, considered, Cook’s Construction Pty Ltd v SFS 007.298.633 Pty Ltd (2009) 254 ALR 661, distinguished – No statutory entitlement – Whether contravention of s 40(2) founds unjust enrichment claim and forecloses defences – Contravention of s 40(2) may be vitiating factor in unjust enrichment claim, but does not foreclose all defences – Leave to appeal granted – Appeal allowed – Domestic Building Contracts Act ss 3, 13, 40, 132–3.

PRACTICE AND PROCEDURE – Interest – Whether ‘free-standing’ right to interest in action for moneys had and received – Heydon v NRMAPty Ltd[No 2] (2001) 53 NSWLR 600, Chow v Yang [2010] SASC 96, Peet Ltd v Richmond (2011) 33 VR 465, considered – Whether Domestic Building Contracts Act 1995 a ‘written instrument’ by virtue of which amount liable to be paid – Supreme Court Act 1986 ss 58, 60.

WORDS AND PHRASES – ‘contract price’ – ‘domestic building works’ – ‘domestic building contract’ – ‘major domestic building contract’ – ‘builder’ – ‘owner-builder’– ‘written instrument’.

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APPEARANCES:	Counsel	Solicitors
For the Applicant	Mr B B Carr with Ms M Clarkin	David Naidoo & Associates
For the Respondents	Mr S W Stuckey QC with	DSA Lawyers
Mr N A Andreou

KYROU JA
McLEISH JA

NIALL JA:

In 2012, the respondents Paul Cameron and Joseph Alesci contracted with the applicant Lucas Stephens, for…

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 Stephens v Cameron

Details

AGLC: Stephens v Cameron [2021] VSCA 208
Case: [2021] VSCA 208
Decision Date: 30 July 2021

CaseChat Overview and Summary

The case of Stephens v Cameron involved a dispute concerning a contract for the management of the construction of two townhouses. The owners contracted with a registered builder who subsequently engaged trade contractors to carry out the works. The applicants, who were the owners, sought the return of substantial payments made to the builder for incomplete works. The applicants argued that the contract was a ‘domestic building contract’ under the Domestic Building Contracts Act 1995 and that they were not liable for the builder's failure to complete the works. The builders, the respondents, contended that they were not responsible for the incomplete works and that the applicants were in fact owner-builders under the Building Act 1993, which would exempt them from the statutory protections.

The court was required to determine several legal issues, including whether the contract was a ‘domestic building contract’ for the purposes of the Domestic Building Contracts Act 1995. The court also had to decide if the concept of ‘responsibility’ implied a criterion limiting the application of the Act to contracts with persons responsible for the works. Additionally, the court needed to consider whether the applicants were ‘builders’ for the purposes of the Domestic Building Contracts Act, given that the respondents claimed to be owner-builders under the Building Act 1993. Finally, the court needed to assess whether a contravention of section 40(2) of the Domestic Building Contracts Act created a statutory entitlement to repayment of amounts retained by the builder above the prescribed progress payment limits and if such a contravention could foreclose all defences in a claim for unjust enrichment.

The court found that there was no implied criterion of ‘responsibility’ limiting the application of the Domestic Building Contracts Act to contracts with persons responsible for the works. Consequently, the contract for managing and arranging the carrying out of construction of the home was a ‘domestic building contract’ within the meaning of the Act. The court also held that the respondents were not owner-builders for the purposes of the Building Act 1993, and that the concept of ‘owner-builder’ was irrelevant to the characterisation under the Domestic Building Contracts Act. The court held that the applicants were builders for the purposes of the statutory building permit and insurance requirements. The court further found that there was no statutory entitlement to repayment of amounts retained by the builder above the prescribed progress payment limits. However, a contravention of section 40(2) could be a vitiating factor in a claim for unjust enrichment, but it did not foreclose all defences. Leave to appeal was refused in relation to the characterisation of the contract and the characterisation of the applicants as builders, but leave to appeal was granted in relation to the statutory entitlement to repayment of amounts retained by the builder.

The final orders of the court included the dismissal of the applicants' claims for the return of the amounts paid to the builder, the refusal of leave to appeal in relation to the characterisation of the contract and the characterisation of the applicants as builders, and the grant of leave to appeal in relation to the statutory entitlement to repayment of amounts retained by the builder.

Orders