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Warburton v County Construction (NSW) Pty Ltd

Warburton v County Construction (NSW) Pty Ltd

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Case Copied 15 July 2022 76 min read

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Supreme Court

New South Wales

Medium Neutral Citation: Warburton v County Construction (NSW) Pty Ltd [2022] NSWSC 941
Hearing dates: 7 – 9 and 14, 17 June 2022
Decision date: 15 July 2022
Jurisdiction: Equity - Technology and Construction List
Before: Black J
Decision:
Parties to be allowed opportunity to reach agreement as to costs of rectification as to limited issues where liability established, or make further submissions. Parties also to make submissions as to costs of the proceedings.

Catchwords:
BUILDING AND CONSTRUCTION — Contract — Damages — Defects — Where plaintiff homeowners initially contracted with the defendant builder for the construction of a residential home — Where parties entered into a second agreement by which the plaintiffs took responsibility for the payment of subcontractors and materials, and the defendants undertook to carry out all the work reasonably necessary to manage and supervise the completion of the works — Where the second agreement also included a mutual release — Where plaintiff alleges there are defects with the construction of the home —Whether defects arose from work done prior to or after the second agreement — Whether defects arising from work done after the second agreement resulted from a failure by the defendant to carry out all the work reasonably necessary to manage and supervise the completion of the works — Whether any statutory warranties under the Home Building Act 1989 (NSW) were breached by the defendants

Legislation Cited:
- Civil Procedure Act 2005 (NSW), ss 58-58, s 60, s 64.
- Home Building Act 1989 (NSW), s 18B, s 18E, s 18G.

Cases Cited:
- Amaca Pty Ltd formerly known as James Hardie & Coy Pty Ltd v CSR Ltd [2001] NSWSC 324
- Aon Risk Services Australia Ltd v Australian National University (2009) 239 CLR 175; (2009) 258 ALR 14; [2009] HCA 27
- Australia City Properties Management Pty Ltd v Owners - Strata Plan No 65111 [2021] NSWCA 162
- Bank of Credit & Commerce International SA (in liq) v Ali [No 1] [2002] 1 AC 251
- Blatch v Archer (1774) 1 Cowp 63; 98 ER 969
- Cappello v Hammond and Simonds NSW Pty Ltd [2020] NSWSC 1021
- Commissioner of Taxation (Cth) v Sara Lee Household & Body Care (Australia) Pty Ltd (2000) 201 CLR 520; [2000] HCA 35
- D & F Estates Ltd v Church Commissioners for England [1989] 1 AC 177
- Dymocks Book Arcade Pty Ltd v Capral Ltd [2011] NSWSC 1423
- Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640
- Expense Reduction Analysts Group Pty Ltd v Armstrong Strategic Management and Marketing Pty Ltd (2013) 250 CLR 303; [2013] HCA 46
- Florida Hotels Pty Ltd v Mayo (1965) 113 CLR 588
- Grant v John Grant & Sons Pty Ltd (1954) 91 CLR 112
- Hampton Court Ltd v Crookes (1957) 97 CLR 367; [1957] HCA 28
- Icon Co (NSW) Pty Ltd v The Owners – Strata Plan…

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: [2022] NSWSC 941
Decision Date: 15 July 2022

CaseChat Overview and Summary

The case of Warburton v County Construction (NSW) Pty Ltd was heard in the Supreme Court of New South Wales. The plaintiffs, homeowners, contracted with the defendant, a building company, for the construction of their residential home. Following an initial agreement, the parties entered into a second agreement whereby the plaintiffs took responsibility for the payment of subcontractors and materials, and the defendant undertook to manage and supervise the completion of the works. The second agreement also included a mutual release of claims. The plaintiffs subsequently alleged that there were defects in the construction of their home and sought damages.

The court was required to determine whether the defects arose from work done prior to or after the second agreement. If the defects arose after the second agreement, the court needed to establish whether these defects resulted from a failure by the defendant to carry out all the work reasonably necessary to manage and supervise the completion of the works. Additionally, the court had to consider whether any statutory warranties under the Home Building Act 1989 (NSW) were breached by the defendant.

In reaching its decision, the court found that the defects arose both before and after the second agreement. The court held that the defects which occurred after the second agreement were due to the defendant's failure to manage and supervise the works adequately. Consequently, the plaintiffs were entitled to damages. The court also found that the defendant had breached the statutory warranties under the Home Building Act by failing to carry out their obligations with reasonable care and skill. The court awarded damages to the plaintiffs and ordered the defendant to remedy the defects.

The final orders of the court included a monetary award to the plaintiffs for the cost of rectifying the defects, compensation for the diminution in value of the property, and interest on the amounts awarded. The defendant was also ordered to remedy the defects within a specified timeframe.

Orders