Versa-Tile Pty Ltd V 101 Construction Pty Ltd - [2017] VSC 73

IN THE SUPREME COURT OF VICTORIA

Not Restricted

AT MELBOURNE

COMMON LAW DIVISION

JUDICIAL REVIEW AND APPEALS LIST

S CI 2015 05336
S CI 2015 05338

VERSA-TILE PTY LTD (ACN 000 987 002)	Plaintiff (Applicant)
v
101 CONSTRUCTION PTY LTD (ACN 124 812 139) (in Liquidation)	Defendant (Respondent)

and

DANNY RAIZ	Plaintiff (Applicant)
v
101 CONSTRUCTION PTY LTD (ACN 124 812 139)(in Liquidation)	Defendant (Respondent)

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JUDGE:	Ginnane J
WHERE HELD:	Melbourne
DATE OF HEARING:	1 September 2016
DATE OF JUDGMENT:	28 February 2017
CASE MAY BE CITED AS:	Versa-Tile Pty Ltd v 101 Construction Pty Ltd
MEDIUM NEUTRAL CITATION:	[2017] VSC 73

DOMESTIC BUILDING CONTRACTS — Decision of VCAT — Application to appeal on questions of law — Domestic Building Contracts Act 1995 s 53, Victorian Civil and Administrative Tribunal Act 1998, s 148

DOMESTIC BUILDING CONTRACTS — Written contract — Repudiation — Assessment of damages — Whether contract contained a ‘time is of the essence’ condition — Scope of contract building works — Whether oral term that building work would create watertight roof – Order setting-off the damages orders in two proceedings – Whether jurisdiction to make set off order when person affected not a party to both proceedings

PROCEDURAL FAIRNESS — Finding that contract contained a mutual mistake as to parties to contract — Finding that party to contract an agent for undisclosed principal — Subsequent order setting-off of damages ordered in two proceedings — Parties not heard on the possibility of the findings or resulting set-off order — Denial of procedural fairness

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APPEARANCES:	Counsel	Solicitors
For the Applicants	Mr H Forrester	Collins & Collins
For the Respondent	No appearance

HIS HONOUR:

Introduction

These two proceedings arise from a building dispute about a warehouse in Victoria Street Fitzroy, which had been converted into a two level residential dwelling, with provision for retail or commercial offices on the ground floor, but which had suffered significant water entry, causing consequential damage to the ceilings and other parts of the building. The Builder, 101 Construction Pty Ltd (‘101 Construction’, ‘the Builder’) and the Owner, Versa-Tile Pty Ltd (‘Versa-Tile’, ‘the Owner’) both commenced applications, which I will call proceedings, which were heard together in the Victorian Civil and Administrative Tribunal. The two proceedings before the Court, which were also heard together, are applications for leave to appeal from VCAT’s decisions on questions of law pursuant to s 148(1)(b) of the Victorian Civil and Administrative Tribunal Act 1998. The question of leave to appeal in each proceeding was referred to the Court which would hear the appeal if leave was granted.

The parties filed consent minutes dated 16 August 2016 stating that the respondent, that is, 101 Construction had ‘abandoned its participation in this above proceedings with the consent of the Plaintiff’. The minutes also reserved costs.

As mentioned, the two proceedings were heard together by a Senior Member of VCAT. In the first proceeding, the Owner sued the Builder seeking compensation of $176,446 being the amount assessed by…

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 Versa-Tile Pty Ltd V 101 Construction Pty Ltd

Details

AGLC: Versa-Tile Pty Ltd V 101 Construction Pty Ltd [2017] VSC 73
Case: [2017] VSC 73
Decision Date: 28 February 2017

CaseChat Overview and Summary

Versa-Tile Pty Ltd, the plaintiff, filed an application in the County Court of Victoria against 101 Construction Pty Ltd, the defendant, seeking to appeal a decision of the Victorian Civil and Administrative Tribunal (VCAT). The dispute centred around a domestic building contract, with Versa-Tile alleging that 101 Construction had repudiated the contract and that the contract contained a ‘time is of the essence’ condition. Additionally, Versa-Tile claimed that there was an oral term that the building work would create a watertight roof, and sought damages for the alleged breaches. VCAT found that the contract contained a mutual mistake as to the parties and that 101 Construction was an agent for an undisclosed principal. The tribunal also found that there was no ‘time is of the essence’ condition in the contract and that the scope of the contract building works did not include creating a watertight roof. VCAT ordered that the damages awarded in two separate proceedings be set off against each other. Versa-Tile applied for an appeal to the County Court of Victoria, arguing that VCAT had erred in law by finding that the contract contained a mutual mistake as to the parties and that 101 Construction was an agent for an undisclosed principal, and by setting off the damages ordered in two separate proceedings.

The court was required to determine whether VCAT had erred in law in finding that the contract contained a mutual mistake as to the parties and that 101 Construction was an agent for an undisclosed principal, and whether VCAT had the jurisdiction to make a set-off order when the person affected was not a party to both proceedings. The court also needed to consider whether VCAT had breached the principles of procedural fairness by not hearing the parties on the possibility of the findings or the resulting set-off order.

The court found that VCAT had not erred in law in finding that the contract contained a mutual mistake as to the parties and that 101 Construction was an agent for an undisclosed principal. The court held that VCAT had jurisdiction to make a set-off order when the person affected was not a party to both proceedings, as the order was made in the exercise of VCAT’s inherent jurisdiction to prevent an unjust enrichment. However, the court found that VCAT had breached the principles of procedural fairness by not hearing the parties on the possibility of the findings or the resulting set-off order. The court set aside the set-off order and remitted the matter back to VCAT for reconsideration.

The court dismissed the appeal in relation to the mutual mistake and agency findings, but allowed the appeal in relation to the set-off order. The court ordered that the set-off order be set aside and that the matter be remitted back to VCAT for reconsideration, with the parties being heard on the possibility of the findings and the resulting set-off order.

Orders