Wheeler v Ecroplot Pty Ltd

Case [2010] NSWCA 61


Appeal Outcome: Special leave refused with costs by the High Court, 3 September 2010, (S105/2010)

New South Wales


Court of Appeal


CITATION: Wheeler & Anor v Ecroplot Pty Ltd [2010] NSWCA 61
HEARING DATE(S): 19 February 2010
 
JUDGMENT DATE: 

1 April 2010
JUDGMENT OF: McColl JA at 1; Basten JA at 2; Macfarlan JA at 3
DECISION: (1) Appeal allowed;
(2) Orders made at first instance be set aside other than the specific costs orders made on 7 November 2008 and 18 December 2008;
(3) Judgment for the appellants in the sum of $107,224.64 plus interest pursuant to s 101 of the Civil Procedure Act 2005 from 20 February 2009;
(4) Order the respondent to pay the appellants’ costs of the appeal and of the proceedings at first instance other than the costs which are the subject of the specific costs orders referred to in (2) above; and
(5) Grant the respondent a certificate under the Suitors’ Fund Act 1951 if not disqualified under s 6(7).
CATCHWORDS: CONTRACTS - building contract - builder's obligation to execute work in proper and workmanlike manner - compacted land fill allowed to dry out before concrete slab poured on top of it - DAMAGES - breaches of building contract for construction of dwelling - whether underpinning to rectify stability related breach reasonable - Bellgrove v Eldridge - Tabcorp Holdings Pty Ltd v Bowen Investments Pty Ltd
LEGISLATION CITED: Civil Procedure Act 2005
Suitors' Fund Act 1951
CATEGORY: Principal judgment
CASES CITED: Bellgrove v Eldridge [1954] HCA 36; (1954) 90 CLR 613
Brewarrina Shire Council v Beckhaus Civil Pty Ltd [2006] NSWCA 361
Building Insurers' Guarantee Corporation v The Owners - Strata Plan No 57504 [2010] NSWCA 23
Fox v Percy [2003] HCA 22; (2003) 214 CLR 118
Gagner Pty Ltd v Canturi Corporation Pty Ltd [2009] NSWCA 413
Kirkby v Coote [2006] QCA 61
South Parklands Hockey & Tennis Centre Inc v Brown Falkiner Group Pty Ltd [2004] SASC 81
Westpoint Management Ltd v Chocolate Factory Apartments Ltd [2007] NSWCA 253
Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [2009] HCA 8; (2009) 236 CLR 272
PARTIES: David Wheeler (First Appellant)
Alison Wheeler (Second Appellant)
Ecroplot Pty Ltd (Respondent)
FILE NUMBER(S): CA 40256/09
COUNSEL: R J Webb SC/S B Loughnan (Appellants)
S V Shepherd (Respondent)
SOLICITORS:

Commins Hendriks (Appellants)
Creaghe Lisle (Respondent)

LOWER COURT JURISDICTION: District Court
LOWER COURT FILE NUMBER(S): DC 776/07
LOWER COURT JUDICIAL OFFICER: Gibb DCJ
LOWER COURT DATE OF DECISION: 1 May 2009





                          CA 40256/09
                          DC 776/07

                          McCOLL JA
                          BASTEN JA
                          MACFARLAN JA

                          1 APRIL 2010
WHEELER & ANOR v ECROPLOT PTY LTD
Judgment

1 McCOLL JA: I agree with Macfarlan JA’s reasons and the orders his Honour proposes.

2 BASTEN JA: I agree with the orders proposed by Macfarlan JA and his Honour’s reasons.

: These reasons for judgment are organised under the following headings:


      (1) Nature of case and conclusions [4]
      (2) The building contract [8]
      (3) Construction of the home [11]
      (4)…

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AGLC
Wheeler v Ecroplot Pty Ltd [2010] NSWCA 61
Case
[2010] NSWCA 61
Decision Date

CaseChat Overview and Summary

In *Wheeler v Ecroplot Pty Ltd*, the New South Wales Court of Appeal considered a dispute arising from a building contract for the construction of a dwelling. The appellants, the owners of the dwelling, alleged that the respondent builder had breached its contractual obligation to execute the work in a proper and workmanlike manner. Specifically, the appellants contended that the builder had allowed compacted land fill to dry out before pouring a concrete slab on top of it, leading to stability issues.

The Court of Appeal was required to determine whether the builder had breached the contract by failing to construct the dwelling in a proper and workmanlike manner, and if so, what damages were recoverable. A key issue was whether the proposed underpinning work to rectify the stability-related breach was reasonable, having regard to the principles established in cases such as *Bellgrove v Eldridge* and *Tabcorp Holdings Ltd v Bowen Investments Pty Ltd*.

The Court found that the builder had indeed breached the contract. Applying the principles of remoteness and reasonableness in assessing damages for breach of a building contract, the Court determined that the cost of rectifying the defects, including underpinning, was a reasonable measure of the loss suffered by the appellants. The Court reasoned that the builder's failure to properly prepare the foundation had directly caused the instability, and the proposed rectification work was necessary to restore the dwelling to the condition it would have been in had the contract been performed properly.

The Court of Appeal allowed the appeal, setting aside the orders made at first instance. It entered judgment for the appellants in the sum of $107,224.64, plus interest. The respondent was ordered to pay the appellants’ costs of the appeal and of the proceedings at first instance, with a provision for a certificate under the Suitors’ Fund Act 1951.

Orders

Orders of the court

(1) Appeal allowed;

(2) Orders made at first instance be set aside other than the specific costs orders made on 7 November 2008 and 18 December 2008;

(3) Judgment for the appellants in the sum of $107,224.64 plus interest pursuant to s 101 of the Civil Procedure Act 2005 from 20 February 2009;

(4) Order the respondent to pay the appellants’ costs of the appeal and of the proceedings at first instance other than the costs which are the subject of the specific costs orders referred to in (2) above; and

(5) Grant the respondent a certificate under the Suitors’ Fund Act 1951 if not disqualified under s 6(7).

Background

Background to the litigation

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Evidence

Evidence Before The Court

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Decision

Reasons for decision

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Ratio Decidendi

Legal Principle Established

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