Construction Law Review – October 2022

Construction Law Review

Please refer below to our Construction Law Review, selected from AR Conolly’s Daily Bulletins covering Insurance, Banking, Construction & Government.

Boulus Constructions Pty Ltd v Warrumbungle Shire Council [2022] NSWSC 1368
Supreme Court of New South Wales
Stevenson J
Construction – cross-claimant seeks to introduce claim for breach of statutory duty under s37 of the Design and Building Practitioners Act 2020 (NSW) (DBP Act) – statutory duty on construction industry participants to exercise reasonable care recently introduced by s37, DBP Act – duty of care under DBP Act could potentially come within ambit of a “person who carries out construction work” – definition of “construction work” – not necessary a person be “practitioner” as defined by the DBP Act to be captured by duty of care – whether person can exercise “substantive control” over carrying out of building or design work or manufacture or supply of building products will be assessed as a question of fact of each case – substantive control includes, but not limited to, being able to control how “construction work” is carried out – The Owners “ Strata Plan No 84674 v Pafburn Pty Ltd considered – “substantive control over the carrying out of” work if person “was in a position where it was able to so control how the work was carried out” – leave granted to amend cross-claim, cross-summons and cross-claim list statement – application dismissed.
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Kaye v The Owners – Strata Plan No 4350 [2022] NSWSC 1386
Supreme Court of New South Wales
Basten AJ
Land law – strata title – common property – two by-laws to obtain rights to exclusive use and enjoyment of common property – first proposal offered repairs and maintenance – second proposal offered monetary compensation – other lot owners concerned about noise, loss of privacy, lack of compensation, floodgates for applications – Strata Schemes Management Act 2015 (NSW), s149(2) considerations addressed to whether to order making of by-law – proponents’ rights and expectations not to be weighed against other lot owners’ interests – appeal brought from a decision of an Appeal Panel of the NSW Civil and Administrative Tribunal – finding of special circumstances – no mandatory considerations – unsuccessful appeal and fact of legal representation permissible considerations – finding of complexity – focus of proposed appeal turned upon the power of the Tribunal to award costs, as found in s60 of the Civil and Administrative Tribunal Act 2013 (NSW) – although there is a “Division Schedule” for the Consumer and Commercial Division (Sch 4), that does not make provision for costs – s35 is the first provision in Pt 4, which includes s60 – if rr38 and 38A of the Civil and Administrative Tribunal Rules 2014 (NSW) are engaged, they operate to the exclusion of s60 – appeal dismissed.
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Krolczyk v Winner t/as J Winner Building Services [2022] NSWCA 196
Supreme Court of New South Wales – Court of Appeal
White JA, Kirk JA, Griffiths AJA
Construction – contract – respondent, licenced builder and the appellants, registered proprietors of property commenced planned renovation works – respondent performed some work personally – assisted with progression of renovation project and assisting with development application process and enlisted tradespeople – defective works – appellants contended respondent agreed to be builder for the project pursuant to a partly written and partly oral contract pursuant to s18B of the Home Building Act 1989 (NSW) – alternatively contended respondent was supervisor – whether contract existed – whether respondent engaged as either builder or supervisor – alleged partly written and partly oral contract – no contract in existence – onus regarding intention to create legal relations – primary judge did not erroneously place onus on the appellants to prove that there was an intention to create legal relations – duty to mitigate loss – primary judge ought to have found that the respondent had not discharged his onus of establishing that the appellants acted unreasonably in not mitigating their loss – appellants were entitled to take into account that respondent carried onus of establishing a failure to mitigate – primary judge found respondent would be entitled to the benefit of an exclusion in the Home Building Act if he supervised the works – express finding that respondent not engaged as a supervisor – no appealable error in those findings was demonstrated – legislation could have no application to him based on a claim that he was supervising the work – appeal upheld in part.
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Onslow v Cullen [2022] NSWSC 1257
Supreme Court of New South Wales
Adamson J
Construction – contracts – breach of contract – statutory warranties – builder failed to complete works under the contract – builder relied on s18E(1) of the Home Building Act 1989 (NSW) (HB Act) – owner entitled to sue for damages for breach of contract, which allowed proceedings to commence within 6 years under Limitation Act 1969 (NSW) – appeal – whether magistrate erred in construing the contract which incorporated statutory warranties found in s18B of the HB Act, by that the limitation under s14(1)(a) of the Limitation Act of 6 years applied instead of the 2 years for minor defects in the HB Act – competing statutory limitation period applies in lieu of the Limitation Act – s7(a) of the Limitation Act has the effect that, if there is another limitation period specified in another “enactment”, the other limitation period will apply rather than the one specified in the Limitation Act – 18G refers to “rights of a person” – owners have a right to the benefit of the statutory warranties in terms but the builder has the right not to be sued in respect of non-major defects after the two year period has elapsed – contract’s prefatory words serve to limit any warranty to the extent otherwise provided under the HB Act – cl 9 of the contract is designed to comply with s7(2)(f) of the Limitation Act and replicate warranties in s18B in the HB Act – appeal allowed.
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