Ahmad v Bourne Construction Australia [2025] FedCFamC2G 1616

1. This is an application for damages by reason of alleged building defects and breaches of the statutory consumer guarantees and/or breach of contract.
2. At the relevant times, the Respondent operated a business as a builder of domestic buildings pursuant to registration under the Building Act 1995 (Vic). In November 2017, the Applicants contracted with the Respondent for the construction of a split level rendered poly and garage at the contract price of $500,000. There is a dispute about variations which the Applicants say were subsequently agreed and the Respondent denies. In any event, building works were carried out between November 2017 and May 2020 and it is alleged in these proceedings that the Respondent failed to comply with statutory consumer guarantees in Schedule 2 of the Competition and Consumer Act 2010 (Cth) (the Australian Consumer Law (ACL)) in respect of acceptable quality of goods, fitness for disclosed purpose of goods, due care and skill and fitness for a particular purpose and/or engaged in breach(es) of the contract between them.
3. By their statement of claim, the Applicants claim to have suffered loss and damage in the amount of $908,423.75, and seek an order for damages pursuant to s.267(4) of the ACL.
4. These reasons address the preliminary issues of:

(a) The jurisdiction of this Court to determine an application pursuant to s.267(4) where the damages sought exceed the statutory limit of $750,000 at s.138A; and

(b) Whether the proceedings be transferred to the Federal Court of Australia.

1. On 28 May 2025, the Applicants filed the originating application and statement of claim in this Court.
2. On 4 July 2025, the Respondent filed a defence.
3. On 7 July 2025, the matter came before the Court as presently constituted for first procedural mention. Among other programming orders made by consent of the parties, the Applicant was ordered to file and serve any amended statement of claim or any transfer application.
4. On 22 July 2025, the Applicants filed 4 expert reports on which they intend to rely in the substantive proceeding. That being: a report of a Tom O'Dowd Building Consultant of Tony Croucher & Associates Pty Ltd dated 3 August 2021; a supplementary report of Tom O'Dowd dated 22 December 2022; a report of a Peter Noel Wenning Hydraulic Services Consultant of Wenning Technical Services dated 28 January 2023; and a report of a Graham Neale Registered Building Practitioners of Building Surveyor-Unlimited 1515 (BS-U 1515) dated 5 November 2023.
5. No expert report was filed for or by the Respondent in response as invited by the consent program.
6. On 11 August 2025, the Applicants filed an application in a proceeding seeking an order pursuant to s.153(1) of the Federal Circuit and Family Court of Australia Act 2021 (Cth) (FCFCOA Act) that the proceeding be transferred from this Court to the Federal Court of Australia. In addition, the Applicants sought orders that the requirement in r.8.02(1)(a) of the then Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2021 (Cth) (2021 Rules) that a transfer be made before the first court date for the proceeding be dispensed with and the Respondent pay the Applicants' costs of the application. An accompanying affidavit of a solicitor for the Applicants deposed on 1 August 2025 annexed evidence indicating that the Respondent did not consent to the transfer. The parties were subsequently directed to file submissions in respect of the application in a proceeding and the matter was fixed for interlocutory hearing.
7. On 22 August 2025, the Applicants filed an outline of submissions addressing their request for transfer to the Federal Court.
8. On 27 August 2025, the Respondent filed an outline of submissions in response to the application for transfer.
9. On 3 September 2025, the interlocutory application for a transfer of the proceedings to the Federal Court was heard before the Court as presently constituted. The Applicants and the Respondent were respectively represented by Counsel.

1. It is necessary to first resolve the question of jurisdiction of this Court to determine the application for damages under s.267(4) where the damages sought exceeds the jurisdictional limit at s.138A of the ACL.
2. Part XI of the ACL provides for the application of the ACL as a law of the Commonwealth. Section 138A of the Act confers jurisdiction on this Court in relation to any matter arising under Part XI or the ACL and an express limitation on that jurisdiction, expressed as follows:

Conferring jurisdiction on the Federal Circuit and Family Court of Australia (Division 2)

(1) Subject to this section, jurisdiction is conferred on the Federal Circuit and Family Court of Australia (Division 2) in relation to any matter arising under this Part or the Australian Consumer Law in respect of which a civil proceeding is instituted by a person other than the Commonwealth Minister.

(2) If proceedings under Part 3 - 5, or section 236, of the Australian Consumer Law are instituted in, or transferred to, the Federal Circuit and Family Court of Australia (Division 2), the Court does not have jurisdiction to award an amount for loss or damage that exceeds:

(a) $750,000; or

(b) if another amount is specified in the regulations--that other amount.

Note: For transfers from the Federal Court to the Federal Circuit and Family Court of Australia (Division 2): see section 32AB of the Federal Court of Australia Act 1976.

1. Chapter 3 of the ACL contains the "specific protections". Within it, Part 3-2 - Consumer Transactions outlines the consumer guarantees - the alleged breach of which forms the foundation of these proceedings (in addition to alleged breach of contract). Specifically, within Division 1 - Consumer guarantees and:

(a) Subdivision A - Guarantees relating to the supply of goods, the following:

• Guarantee as to acceptable quality of goods (s.54);
• Guarantee as to fitness for any disclosed purpose (s.55),

(b) Subdivision B - Guarantees relating to the supply of services, the following:

• Guarantee as to due care and skill (s.60);
• Guarantee as to fitness for a particular purpose etc. (s.61).

1. Part 3-5 - Liability of manufacturers for goods with safety defects also contains a series of divisions including Division 1 - Actions against manufacturers for goods with safety defects - none of which are relevant to the present proceedings.
2. Chapter 5 of the ACL relates to enforcement and remedies.
3. Part 5-2 - Remedies contains a series of divisions including Division 3 - Damages, of which s.236 is part. Section 236 provides:

236 Actions for damages

(1) If:

(a) a person (the claimant) suffers loss or damage because of the conduct of another person; and

(b) the conduct contravened a provision of Chapter 2 or 3;

the claimant may recover the amount of the loss or damage by action against that other person, or against any person involved in the contravention.

(2) An action under subsection (1) may be commenced at any time within 6 years after the day on which the cause of action that relates to the conduct accrued.

Division 4 -- Compensation orders etc. for injured persons and orders for non - parties

1. Part 5-4 - Remedies relating to guarantees contains a series of divisions including Division 1 - Action against suppliers, of which s.267 is part. Section 267 provides:

Subdivision B--Action against suppliers of services

267 Action against suppliers of services

(1) A consumer may take action under this section if:

(a) a person (the supplier) supplies, in trade or commerce, services to the consumer; and

(b) a guarantee that applies to the supply under Subdivision B of Division 1 of Part 3 - 2 is not complied with; and

(c) unless the guarantee is the guarantee under section 60--the failure to comply with the guarantee did not occur only because of:

(i) an act, default or omission of, or a representation made by, any person other than the supplier, or an agent or employee of the supplier; or

(ii) a cause independent of human control that occurred after the services were supplied.

(2) If the failure to comply with the guarantee can be remedied and is not a major failure:

(a) the consumer may require the supplier to remedy the failure within a reasonable time; or

(b) if such a requirement is made of the supplier but the supplier refuses or fails to comply with the requirement, or fails to comply with the requirement within a reasonable time--the consumer may:

(i) otherwise have the failure remedied and, by action against the supplier, recover all reasonable costs incurred by the consumer in having the failure so remedied; or

(ii) terminate the contract for the supply of the services.

(3) If the failure to comply with the guarantee cannot be remedied or is a major failure, the consumer may:

(a) terminate the contract for the supply of the services; or

(b) by action against the supplier, recover compensation for any reduction in the value of the services below the price paid or payable by the consumer for the services.

(4) The consumer may, by action against the supplier, recover damages for any loss or damage suffered by the consumer because of the failure to comply with the guarantee if it was reasonably foreseeable that the consumer would suffer such loss or damage as a result of such a failure.

(5) To avoid doubt, subsection (4) applies in addition to subsections (2) and (3).

1. The Court was taken to the decision in Moore v Scenic Tours Pty Ltd [2020] HCA 17; (2020) 268 CLR 326 (CJ Kiefel, JJ Bell, Gageler, Keane, Nettle, Gordon and Edelman) as authority for the principle that ss.267(2) and 267(4) of the ACL are mutually exclusive. That is not the issue in the present case.
2. In my view, s.138A of the Act is in clear terms. The present proceedings are not, strictly according to the statement of claim, brought under Part 3-5 or s.236 of the ACL as to engage the s.138A limit. However, the statement of claim seeks damages purportedly under s.267(4). That provision specifies that a consumer may take action against a supplier of services under the provision only if the criterion at s.267(1)(a) and (b) and (c) apply. The trouble is that the application in the present proceedings is not limited to action for alleged non-compliance with a guarantee that applies to the supply under Subdivision B of Division 1 of Part 3-2 - being a mandatory pre-requisite pursuant to s.267(1)(b).
3. If the Applicants were to seek damages for alleged non-compliance with a guarantee that applies under Subdivision A of Division 1 of Part 3-2, as their original statement of claim provides, then s.267(4) would not be engaged and they would need to pursue that remedy for damages under a different statutory route. For example, in respect of the guarantees at Subdivision A, damages under s.236 for conduct alleged to have contravened Chapter 3. It is that part of the application that might possibly engage the limit on the Court's jurisdiction at s.138A(2).
4. The total damages sought are $908,423.75. The breakdown of damages sought under each of Subdivisions A and B is not particularised in the case as presently put. Were the Applicants to so specify the causes of action with more precision then there is a possibility that the case may proceed before this Court. However, without more, I am unable to find that the part of the application that relates to the alleged contraventions of Chapter 3 (Subdivision A guarantees) and which part is not caught by s.267(4) seeks an award for an amount of loss or damage that does not exceed $750,000.
5. The Applicants have been afforded an opportunity to file an amended statement of claim and elected not do so. In all of the circumstances, the Applicant ought be allowed a further opportunity to re-plead with the benefit of these reasons.

1. Turning then to the Applicants' request for a transfer of the proceedings to the Federal Court. The application in a proceeding identified the power to make a discretionary transfer order pursuant to s.153 of the FCFCOA Act and sought an order be made dispensing with the requirement that such order be made before the first Court date per r.8.02(1)(a) of the 2021 Rules.

1. Section 153 of the FCFCOA Act provides for a discretionary transfer of proceedings pending in this Court as follows:

Discretionary transfer of proceedings

(1) If:

(a) a proceeding is pending in the Federal Circuit and Family Court of Australia (Division 2); and

(b) the proceeding is not a family law or child support proceeding;

the Court may, by order, transfer the proceeding from the Court to the Federal Court.

(2) The Federal Circuit and Family Court of Australia (Division 2) may transfer a proceeding:

(a) on the application of a party to the proceeding; or

(b) on its own initiative.

(3) In deciding whether to transfer a proceeding to the Federal Court, the Federal Circuit and Family Court of Australia (Division 2) must have regard to:

(a) any Rules of Court made for the purposes of subsection 154(2); and

(b) whether proceedings in respect of an associated matter are pending in the Federal Court; and

(c) whether the resources of the Federal Circuit and Family Court of Australia (Division 2) are sufficient to hear and determine the proceeding; and

(d) the interests of the administration of justice.

(4) If an order is made under subsection (1), the order takes effect on the day that the order is confirmed by the Federal Court under section 32AD of the Federal Court of Australia Act 1976.

(5) The Federal Circuit and Family Court of Australia (Division 2) may make such orders as it considers necessary pending the order transferring the proceeding being confirmed by the Federal Court.

(6) An appeal does not lie from a decision of the Federal Circuit and Family Court of Australia (Division 2) in relation to the transfer of a proceeding under this section.

(7) This section does not apply to proceedings of a kind specified in the regulations.

154 Rules of Court

(1) The Rules of Court may make provision in relation to transfers of

proceedings to the Federal Court under subsection 153(1),

including in relation to the scale of costs that applies to any order

made in respect of proceedings that are transferred.

(2) In particular, the Rules of Court may set out factors that are to be

taken into account by the Federal Circuit and Family Court of

Australia (Division 2) in deciding whether to transfer a proceeding

to the Federal Court under subsection 153(1).

(3) Before Rules of Court are made for the purposes of this section, the

Chief Judge of the Federal Circuit and Family Court of Australia

(Division 2) must consult the Chief Justice of the Federal Court.

1. In the period since the interlocutory application was made (on 1 August 2025) and heard (on 3 September 2025), the 2021 Rules were superseded by the current Federal Circuit and Family Court of Australia (Division 2) (General Federal Law) Rules 2025 (Cth) (2025 Rules). There are no specific transitional provisions however there is an overarching discretion to modify or dispense with the 2025 Rules if, in a particular case, the 2025 Rules are insufficient or inappropriate: r.1.06 of the 2025 Rules.
2. The relevant rule under the 2021 Rules was found at r.8.02. Its current equivalent under the 2025 Rules is r.20.01 which provides as follows:

20.01 Transfer to Federal Court

(1) Unless the Court otherwise orders, an application under paragraph 153(2)(a) of

the Act to transfer a proceeding from the Court to the Federal Court must:

(a) be made on or before the first court date for the proceeding; and

(b) be included in an application or a response in accordance with the

approved form; and

(c) be supported by an affidavit.

Note: Subsection 153(1) of the Act provides that the Court may, by order, transfer a

proceeding that is pending in the Court and is not a family law or child support

proceeding to the Federal Court. Subsection 153(2) of the Act provides that the Court

may transfer the proceeding on the application of a party to the proceeding or on its own initiative.

(2) In addition to the factors to which the Court must have regard under

subsection 153(3) of the Act in deciding whether to transfer a proceeding to the

Federal Court, the Court must take the following factors into account:

(a) whether the proceeding is likely to involve questions of general

importance, such that it would be desirable for there to be a decision of the

Federal Court on one or more of the points in issue;

(b) whether, if the proceeding is transferred, it is likely to be heard and

determined at less cost and more convenience to the parties than if the

proceeding were not transferred;

(c) whether the proceeding will be heard earlier in the Court;

(d) the availability of particular procedures appropriate for the class of

proceeding;

(e) the wishes of the parties.

(3) Before the Court makes an order under subsection 153(1) of the Act transferring

a proceeding from the Court to the Federal Court:

(a) the Court must consult the Chief Judge of the Court in relation to the

proposed transfer; and

(b) the Chief Judge of the Court must consult the Chief Justice of the Federal

Court, or a delegate of the Chief Justice of the Federal Court, in relation to

the proposed transfer.

(4) A failure to comply with this rule in relation to a proposed transfer of a

proceeding under subsection 153(1) of the Act does not affect the validity of an order made under that subsection transferring the proceeding.

1. For present purposes, the only material difference is at r.20.01(3) which essentially provides for consultation within the Court and between the Chief Judge and the Chief Justice of the Federal Court - which sub-rule is only engaged before the Court makes an order under s.153(1) of the Act transferring a proceeding from the Court to the Federal Court in relation to a proposed transfer.
2. By their submissions, the Applicants seek that the matter be transferred on the basis that they may - there, in the Federal Court - seek the full amount of loss and damage to the extent of a finding that the current claim exceeds this Court's jurisdiction. Failing the transfer of the matter, the Applicants contended they would be greatly prejudiced in that they may not receive the entirety of the loss incurred by reasons of the conduct as alleged against the Respondent. The Applicants said the costs of pursuit in the Federal Court would be less or similar and, if they withdrew these proceedings and re-filed, then the Respondent would be able to bring a costs application against them. As such, the Applicants said it is in the interests of justice that the proceeding be transferred.
3. For their part, the Respondent submitted that the Applicants have taken the choice of this jurisdiction largely to avoid the mandatory conciliation regime as applicable in Victorian Courts under the Domestic Building Contracts Act 1995 (Vic) (DBCA Act) and a necessary consequence of bringing the claim in this jurisdiction is they are met with a statutory limit on damages not exceeding $750,000. The Respondent also contended that the cost of transfer of the matter to the Federal Court would significantly increase costs for the Respondent. The Respondent ultimately submitted that the Applicant can amend their claim as to fall within the jurisdictional limit.
4. In weighing whether to exercise the discretion to transfer the proceedings to the Federal Court, I have considered the factors at s.153(3)(a) to (d) of the FCFCOA Act and the criterion at rule 20.01(2) of the 2025 Rules. For completeness, the 2025 Rules apply to the present case which was heard after their commencement. The earlier identified difference with the 2021 Rules is of no consequence given the finding arrived at below and therefore the 2025 Rules would not be waived or dispensed with in this respect, by reason of insufficiency or inappropriateness.
5. The parties did not draw the Court's attention to any proceedings in respect of an associated matter that are pending in the Federal Court.
6. There is no reason to suggest, as the parties acknowledged, that the resources of this Court would be insufficient to hear and determine the proceeding.
7. The transfer application was not made on or before the first Court date. Consistent with the overarching purpose at r.1.05, compliance with r.20.01(1) might be waived in circumstances such as these where the application was foreshadowed at the first Court date and the proceedings are at an early stage.
8. I do not consider the proceedings likely to involve questions of general importance, such that it would be desirable for there to be a decision of the Federal Court on one or more of the points in issue.
9. If transferred, I am not persuaded that the matter is likely to be heard and determined at less cost and more convenience to the parties than if the proceeding were not transferred.
10. There is no basis to find that the proceeding will be heard earlier in the Court or that there are any particular procedures available that would be appropriate for the class of the proceedings.
11. Where the Respondent does not consent nor oppose, I am prepared to accept that the wishes of the parties weigh slightly in favour of the exercise of the discretion in the present case - notwithstanding that the Respondent addressed the Court about why it would not be appropriate to make the transfer order.
12. On what is before the Court, I am not persuaded that the interests of the administration of justice warrant the exercise of the discretion in the present case. The application in a proceeding must be dismissed.

1. For the foregoing reasons, the Court will make orders dismissing the application in a proceeding and allowing leave to amend the statement of claim with the benefit of these reasons.
2. The matter of costs is premature and will be reserved.

I certify that the preceding forty-four (44) numbered paragraphs are a true copy of the Reasons for Judgment of Judge Mansini.