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[2026] NSWCATAP 294
General information, not legal advice.
NCAT Appeal Panel
2026-09-17
G Sarginson, Deputy President G Blake AM SC, Principal Member
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Bahrami Group Pty Ltd v Moriarty [2026] NSWCATAP 294
Hearing dates: 17 August 2026
Date of orders: 17 September 2026
Decision date: 17 September 2026
Jurisdiction: Appeal Panel
Before: G Sarginson, Deputy President
G Blake AM SC, Principal Member
Decision: (1) In respect of the appeal against orders 2 and 3 made on 24 March 2026:
(a) as to ground 1, leave to appeal is granted and the appeal is dismissed;
(b) as to grounds 2 to 4, leave to appeal is refused.
(2) The appeal against orders 2 and 3 made on 16 July 2026 is dismissed.
(3) The Appellants are to pay the costs of the appeal of the Respondents on the ordinary basis as agreed or assessed.
Catchwords: APPEALS — Leave to appeal — Principles governing – Leave to appeal refused
BUILDING AND CONSTRUCTION – s 37 Design and Building Practitioners Act 2020 (NSW) – negligence – duty of care – statutory extension – breach of duty by nominated supervisor of works – nominated supervisor directed construction otherwise than in accordance with the approved plans and specifications – failure by builder to carry out works with due care and skill and in accordance with the plans and specifications set out in the contract
Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW), ss 38, 80, 81, 83, Sch 4, cl 12
Civil and Administrative Tribunal Rules 2014 (NSW), rr 38, 38A
Civil Liability Act 2002 (NSW), ss 5B, 5D
Design and Building Practitioners Act 2020 (NSW), ss 36, 37, 41
Home Building Act 1989 (NSW), ss 48, 48K
Cases Cited: Allen v TriCare (Hastings) Ltd [2017] NSWCATAP 25
Calin v The Greater Union Organisation Pty Ltd (1991) 173 CLR 33; [1991] HCA 23
Collins v Urban [2014] NSWCATAP 17
Deaves v Sigma Group NSW Pty Limited [2023] NSWCATAP 94
Kazzi v KR Properties Global Pty Ltd t/as AK Properties Group [2024] NSWCA 143
Hungry Jack’s Pty Ltd v Fourtounas [2020] NSWCA 325
O’Brien v Women’s Housing Company Limited [2026] NSWCATAP 3
OPES Lifestyles Homes Pty Ltd v KMA Concrete Constructions Pty Ltd [2026] NSWCATAP 275
Oxford (NSW) Pty Ltd v KR Properties Global Pty Ltd trading as AK Properties Group ABN 62 971 068 965 [2023] NSWSC 343
Pafburn Pty Limited v The Owners-Strata Plan No 84674 [2024] HCA 49; (2024) 421 ALR 133;
Schwartz v Health Care Complaints Commission [2026] NSWCA 162
Secretary, Department of Family and Community Services v Smith (2017) 95 NSWLR 597; [2017] NSWCA 206
Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610
Star Training Academy Pty Ltd v Commissioner of Police, NSW Police Force [2026] NSWCATAP 127
The Owners — Strata Plan No 84,674 v Pafburn Pty Ltd (2023) 113 NSWLR 105; [2023] NSWCA 301
The Owners - Strata Plan No 87060 v Loulach Developments Pty Ltd (No 2) [2021] NSWSC 1068
The Owners - Strata Plan No 89005 v Stromer (No 3) [2022] NSWSC 1707
The Owners - Strata Plan No. 91684 v Parkview Constructions Pty Ltd [2025] NSWSC 493
The University of Sydney v Multiplex Constructions Pty Ltd (No 2) [2023] NSWSC 1019
Unique Commercial Group Pty Ltd v Cusumano [2024] NSWCATAP 204
Yuen v Thom [2016] NSWCATAP 243
Texts Cited: None cited
Category: Principal judgment
Parties: Bahrami Group Pty Ltd (First Appellant)
Omid Bahrami Arnesa (Second Appellant)
Damien Moriarty (First Respondent)
Catherine Michelle Moriarty (Second Respondent)
Representation: Counsel:
M Isaac (First and Second Appellants)
J Nathan (First and Second Respondents)
Solicitors:
Gavel and Page (First and Second Appellants)
Bradbury Legal (First and Second Respondents)
File Number(s): 2026/00167033
Publication restriction: Nil
This is an internal appeal from two decisions of the Tribunal, the first made on 24 March 2026 (the 24 March 2026 Decision), and the second made on 16 July 2026 (the 16 July 2026 Decision) in two proceedings under the Home Building Act 1989 (NSW) (HB Act).
The two proceedings concerned a dispute between Damien Moriarty and Catherine Michelle Moriarty (Mr Moriarty and Mrs Moriarty respectively and Mr and Mrs Moriarty where referred to together), who are the owners of a property at Winston Hills in New South Wales (the Property), and Bahrami Group Pty Ltd (Bahrami Group), which is the builder that carried out building works at the Property under a building contract between them (the Building Contract) and its director Omid Bahrami Arnesa (Mr Arnesa).
In the first proceedings Mr and Mrs Moriarty claimed damages against Bahrami Group for defective and incomplete work and out of pocket expenses, and damages against Mr Arnesa for negligence (the Moriarty Proceedings).
In the second proceedings Bahrami Group claimed damages against Mr and Mrs Moriarty for the amount owing under the Building Contract (the Bahrami Group Proceedings).
The Tribunal in the 24 March 2026 Decision relevantly made an order dismissing Bahrami Group’s claim, a money order for Bahrami Group to pay $201,807.56 to Mr and Mrs Moriarty and an order for Bahrami Group and Mr Arnesa to be jointly and severally liable for $201,094.32 for the defective work: Moriarty v Bahrami Group Pty Ltd trading as Build1 Australia [2026] NSWCATCD 65. The Tribunal in the 16 July 2026 Decision relevantly made an order that Bahrami Group pay the costs of Mr and Mrs Moriarty of the Bahrami Group Proceedings, and an order that Bahrami Group and Mr Arnesa pay the costs of Mr and Mrs Moriarty of the Moriarty Proceedings with part of the costs on the indemnity basis.
This appeal raises the following six issues:
whether the Tribunal erred in finding that Mr Arnesa breached the Design and Building Practitioners Act 2020 (NSW) (DBP Act);
whether the Tribunal erred in making a money order instead of a work order in respect of defective work;
whether the Tribunal erred in finding that Mr and Mrs Moriarty validly terminated the Building Contract;
whether the Tribunal erred in its finding as to the commencement date and date of practical completion under the Building Contract;
whether the Tribunal erred in making costs orders against Bahrami Group and a costs order against Mr Arnesa;
the costs of the appeal.
We have granted leave to appeal and dismissed the appeal on the first issue. We have refused leave to appeal on the second to fourth issues. We have consequently dismissed the appeal on the fifth issue. We have decided on the sixth issue that Bahrami Group and Mr Arnesa should pay the costs of the appeal of Mr and Mrs Moriarty on the ordinary basis as agreed or assessed.
Bahrami Group carries on business under the name Build1 Australia. Mr Arnesa was its sole director and the nominated supervisor on its contractor licence at the time that the building works were carried out.
On 8 June 2023, Mr and Mrs Moriarty and Bahrami Group entered into the Building Contract for the construction of alteration works to the internal first floor and ground floor and façade of the house and landscaping at the Property for $510,862. The Building Contract is the November 2020 Master Builders Residential Building (BC4) standard form contract and incorporated various documents.
On 16 June 2023, Mr and Mrs Moriarty wrote to Bahrami Group stating that finance had been fully approved (the 16 June 2023 Moriarty Letter).
Prior to 23 June 2023, Mr and Mrs Moriarty paid $46,086.20 to Bahrami Group.
On 2 October 2023, Mr and Mrs Moriarty paid $102,172.40 to Bahrami Group in payment of progress claim no 1.
On or around 15 April 2024, Bahrami Group issued invoice 6 for $54,086.20 to Mr and Mrs Moriarty.
On 26 April 2024, Mr Arnesa sent an email to Mr and Mrs Moriarty in which he stated constituted a formal notice for suspension of work under the Building Contract on account of their failure to pay invoice 6 (the 26 April 2024 Arnesa Email).
On 26 April 2024, Mr and Mrs Moriarty sent an email to Mr Arnesa in which they stated that they agreed that work would need to be suspended until a resolution is reached (the 26 April 2024 Moriarty Email).
On 10 June 2024, Bahrami Group received payment of invoice 6 from Mr and Mrs Moriarty (the 10 June 2024 Payment).
On 18 September 2024, Mr and Mrs Moriarty sent a letter styled ‘notice of default’ to Bahrami Group in three grounds including its failure to proceed with due diligence and complete the works (the 18 September Moriarty Notice).
On 11 October 2024, Bahrami Group responded relevantly denying the allegations made against it (the 11 October 2024 Bahrami Group Response).
On 6 November 2024, Mr and Mrs Moriarty sent a letter to Bahrami Group terminating the Building Contract under cl 28 (the 6 November 2024 Moriarty Letter).
This dispute resulted in the following two proceedings in the Consumer and Commercial Division of the Tribunal between the parties which were heard at the same time and with evidence in one being evidence in the other:
the Moriarty Proceedings (proceedings 2024/00472065) with Mr and Mrs Moriarty as the applicants and Bahrami Group and Mr Arnesa as the respondents which were commenced on 19 December 2024.
the Bahrami Group Proceedings (proceedings 2025/00103453) with Bahrami Group as the applicant and Mr and Mrs Moriarty as the respondents which were commenced on 17 March 2025.
The hearing of the two proceedings took place on 16 and 17 July and 23 October 2025 before Senior Member D Goldstein. Mr and Mrs Moriarty relied on lay evidence comprising two affidavits of each of them and expert evidence comprising two expert reports of Peter Corbishley (Mr Corbishley) including the supplementary report dated 5 May 2025 (the 5 May 2025 Corbishley Report). Bahrami Group and Mr Arnesa relied only on the expert report of Taeed Athari (Mr Athari) dated 10 July 2025. Concurrent oral evidence was given by Messrs Corbishley and Athari. There were written closing oral submissions.
Mr and Mrs Moriarty in their Points of Claim (the Moriarty Claim) lodged on 19 December 2024 relevantly alleged:
“13 It was an express term of the Contract that the Works would commence on a date subject to finance approval and in compliance with clause 10(a) of the Contract.
Particulars
Clause 5 (a) of Schedule 2 to the Contract
Clause 10 (a) to the Contract”
“13. The Respondents admit paragraph 13 of the Applicants’ Points of Claim.”
Mr Moriarty in his affidavit affirmed on 2 May 2025 relevantly gave the following evidence which was unchallenged:
the entry into the Building Contract which includes the following clauses:
“10. Date for Commencement and Time for Completion of Works
(a) The Builder should commence the works:
(i) on the date specified in Schedule 2 item 5(a);
(ii) within 20 days after the Owner’s compliance with Clause 2(a);
(iii) within 20 days after receipt of the Construction Certificate; or
(iv) within 20 days of any deposit referred to at Schedule 2 item 4(b) being paid; or
(v) within 20 days of the issuance of the Home Building Compensation Fund insurance certificate;
whichever is the later.
(b) The Builder is to proceed with due diligence and bring the works to Practical Completion within the Construction Period stated in Schedule 2 item 5(b). The construction period and consequently the date by which Practical Completion is to be achieved are subject to change under Clause 11. Refer to Clause 11.
…
21. Suspension of Work
(a) Should the Owner:-
(i) fail to pay or cause to be paid any payment or any part thereof including an amount for GST within the time required by Schedule 2 item 4;
…
(b) The Builder is to give notice in writing of any suspension under Clause 21(a) to the Owner.
(c) Should the Owner direct the Builder to not proceed with the works then without prejudice to the Builder’s right to terminate this Contract the Contract is automatically suspended.
(d) The Builder must recommence the works within twenty (20) days of the default in Clause 21(a) or (c) being rectified, or, in the case of Clause 21(a)(v), the Owner providing a written undertaking to not repeat that conduct.
(e) Any period of suspension will automatically and as of right extend the construction period and by consequence the date for practical completion. The Builder is also entitled to claim delay costs for the suspension period calculated in accordance with that set out in Clause 11(f)(ii).
…
28. Termination by the Owner
(a) If the Builder is in default in any of the following respects, namely:
…
(ii) fails to proceed with the works with due diligence or in a competent manner with regard to the circumstances of the contract works; or
…
AND if,
in the case of any default that is capable of remedy, the default continues for twenty five (25) days after notice in writing has been given to the Builder specifying the default and stating the Owner’s intention to terminate this Contract, THEN the Owner may, without prejudice to any other rights or remedies, by notice served as allowed by Clause 30, terminate this Contract.
…
32. Definitions
…
(d) “Construction Period” - see Schedule 2 item 5.
(e) “Day” or “Days” for the purposes of this contract, other than clause 20, does not include:-
(i) Saturdays, Sundays or industry rostered days off;
(ii) or any day that has been gazetted or proclaimed to be a public holiday in the locality where the works are being or are to be executed:
(iii) any other day which specifically excluded from the construction period as listed at Schedule 2 item 5(c).
(iv) January 2, 3, 4, 5, 6 and December 27, 28, 29, 30 and 31 of the calendar year.
Please also refer to Clause 20.
…
SCHEDULE 2
…
4. Payment
(a) PAYMENTS
(Refer to Clauses 18, 19, 20 and 23). Staged claims should not include a claim for the deposit.
Payments can be claimed when the following stages of the works are 95% reached:
(1) Deposit (10%) $ 51,086.20
…
(b) DEPOSIT
A deposit is payable in the amount of $ 51,086.20
Not to exceed 10%. To be deducted from final payment. Refer to Clause 18.
…
5. Construction Period - when will the work be done?
Refer to Clauses 2, 10, and 11.
(a) Proposed Date for Commencement. Refer to Clause 10. Subject to finance
(b) Number of days* to carry out the work (Construction Period”) Refer to Clause 11. 90 days
(c) In addition to those days* exclude in Clause 32, the following days will not form part of the Construction Period (for example: dates of Christmas shutdown, dates of school holidays, days where Builder is unavailable). - Government enforced lockdown Site closure due to COVID-19”
a deposit of $46,086.20 was paid prior to 23 June 2023 and progress claim no 1 of $102,172.40 was paid on 2 October 2023;
at the beginning of the project, he observed Mr Arnesa on site almost every day and as the works progressed, he was often on site one or two days a week. Because he worked from home he observed Mr Arnesa directing staff and various trades on site.
Mrs Moriarty in her affidavit affirmed on 2 May 2025 relevantly gave unchallenged evidence that in the earlier stages of the contract works she observed that Mr Arnesa was on site almost every day. After the downstairs area was no longer available for Mr Arnesa to use as an office, he was absent from the site more frequently and was mainly there to meet Mr Moriarty and her on site once or twice a week. She observed him meet with Bahrami Group’s employees and contractors on site.
Tax Invoice Q2109291456-Inv02 of Bahrami Group dated 15 November 2022 was for $46,086.20 (being the total of the deposit of $51.086.20 less an agreed credit of $5,000.00) (the 15 November 2022 Bahrami Group Invoice).
Mr Corbishley in the 5 May 2025 Corbishley Report in Appendix A headed “Schedule of Alleged Defects” set out in a table his opinions. The table contains eight columns. We have reproduced the first, fourth and fifth columns:
| Item | Column 4 (what the builder failed to do to protect the owners from the risk of harm) | Column 5 (what precautions ought the builder have taken to protect the owners from the risk of harm) | | 1 (Non-compliant sub soil drainage including omitted discharge outlet) | The Builder failed to properly supervise or correctly install sub-soil drainage such that it met contractual or reasonable performance expectations. | Ensure correct installation of subsoil drainage in accordance with 2019 NCC Volume 2 & AS / NZS 3500.3 | | 4 (Non-compliant sanitary drainage) | The Builder failed to properly supervise or install and provide the sanitary drainage in accordance with AS / NZS /3500:2021. Provide mandatory critical stage inspection(s) and certification with relevant certificates. | Ensure correct installation of sanitary plumbing and drainage in accordance with AS NZS 3500.2: 2021 -Plumbing and drainage-Sanitary plumbing and drainage. | | 5 (Broken storm water drainage at the northeast corner of the building) | The Builder failed to properly supervise or install: Correct size stormwater drainage pipe as per Smart Structures plan/specifications (100mm diameter used instead of the specified) | Ensure installation in accordance with Stormwater drainage plan/specifications by Engineer- Smart Structures. | | 6 (included in item 5) | The Builder failed to properly supervise the correct installation of the gas hot water service. | Checked the installation of the gas hot water service and for any leaks. | | 7 (Omitted cavity flashings and drainage weepholes) | The Builder failed to properly supervise the installation of cavity flashings and drainage weepholes during construction. | Checked that brick cavity flashings and drainage weepholes compliant with AS 3700: 2018- Masonry structures were being installed during construction. | | 8 (Termite management systems) | The Builder failed to properly supervise the installation of a termite management system(s) compliant with AS 3660 :1 and AS 3660.2-Termite management. Provide mandatory certification with relevant certificate(s). | That compliant termite management systems where being installed during construction. | | 10 (Noncompliant external waterproofing to front balcony) | The Builder failed to properly supervise the installation of the waterproofing to the front balcony. Provide mandatory Certification with the relevant certificate. | Checked the correct installation of the Waterproofing membrane compliant with AS 4654.2-Waterproofing membranes for external above ground use. | | 11 (include in item 10) | The Builder failed to properly check tiling once completed. | The Builder failed to properly check tiling once completed. | | 12 (Poorly installed front balcony balustrading) | The Builder failed to properly supervise and check the installation of balustrading | The Builder failed to properly supervise and check the installation of the balustrading once completed. | | 17 (Replace retaining wall block work) | The Builder failed to properly supervise the installation of the blockwork. | The Builder failed to have had an inspection completed by an Engineer prior to concrete filling of the blockwork. ▪ Provide mandatory critical stage inspection(s) and certification with relevant certificate(s) for reinforcing placement. | | 18 (Poorly rendered surfaces to rear outdoor living area) | The Builder failed to properly supervise the rendered finishes. | The Builder failed to properly supervise and check the rendered finishes. | | 19 (Rear yard concrete stair riser heights non- compliant with the NCC) | The Builder failed to properly supervise the construction of the stairs which are not in accordance with 2019 NCC Volume 2-Stairway and ramp construction. | The Builder failed to check the compliance of the riser and going heights/widths and have an Engineer inspect prior to pouring the concrete. Provide mandatory critical stage inspection(s) and certification with relevant certificate(s) for reinforcing placement. | | 21 (Poorly Constructed rear deck) | The Builder failed to research documentation regarding the suitability of a ‘Stratco” structure installed in close proximity to a swimming pool, including failing to supervise a extremely poorly constructed deck and out of position stairs. | The Builder failed to advise the Owners that a ‘Stratco’ structure was not suitable to be installed in close proximity to a swimming pool and that an alternate solution should be sort. The builder failed to inform the Owner of the changed stair position at the rear deck, which is different to location shown on the lodged plans. | | 27 (High moisture levels powder room and kitchen floors) | The Builder failed to properly supervise the work to the subject areas, ensuring that damp and weatherproofing in accordance with 2019 NCC Volume 2-Damp and Weatherproofing are met. | The Builder failed to properly supervise the work to the subject areas to ensure that damp and weatherproofing in accordance with 2019 NCC Volume 2-Damp and weatherproofing are met. ▪ Provide mandatory critical stage inspection(s) and certification with relevant certificate(s) before pouring of concrete to floor. | | 29 (included in item 27) | The Builder failed to properly supervise the work to the subject area. | The Builder failed to properly inspect the work to the subject area after completion. | | 31 (omitted water stop angle to shower) | The Builder failed to properly supervise the work to the subject area. | The Builder failed to inspect the works to the subject area, which includes: AS 3740: 2021 -Waterproofing of domestic wet areas. 2019 NCC Volume 2-Glazing: Human impact safety requirements. NSW Guide to Standards and Tolerances. Provide mandatory certification of Waterproofing with relevant |
There was no cross-examination of Mr Corbishley in relation to the table in Appendix A to the 5 May 2025 Corbishley Report.
Bahrami Group and Mr Arnesa in their undated closing submissions made no submission as to the commencement date under the Building Contract.
On 24 March 2026, the Tribunal constituted by Senior Member D Goldstein made the 24 March 2026 Decision comprising:
orders including:
“2. Bahrami Group Pty Ltd must pay Damien Moriarty and Catherine Moriarty the sum of $201,807.56 immediately
- Omid Bahrami Arnesa is jointly and severally liable with Bahrami Group Pty Ltd to immediately pay Damien Moriarty and Catherine Moriarty the sum of $201,094.32 for the defective work referred to at [216] of the Reasons for Decision.”
(a) the construction period of 90 days commenced on 16 June 2023 upon the notification to Bahrami Group by Mr and Mrs Moriarty of their approval of finance in the 16 June 2023 Moriarty Letter; (b) the 26 April 2024 Arnesa Email was a proper notice of suspension under cl 21(a) of the Building Contract; (c) the 26 April 2024 Moriarty Email was a direction by Mr and Mrs Moriarty under clause 21(c) of the Building Contract; (d) the effect of the 10 June 2024 Payment was that Bahrami Group was obliged by the terms of cl 21(d) of the Building Contract to recommence the building works within 20 days; (e) the effect of the suspension of the works pursuant to cl 21(e) of the Building Contract was that the construction period was extended automatically and as of right by the period of suspension, which was 31 days from 27 April to 10 June 2024 and potentially for a further 20 days after 10 June 2024 depending on when Bahrami Group recommenced the works; (f) taking the best possible position from Bahrami Group’s perspective would allow an extension of time of 51 days to the construction period that (31 days + 20 days). The date for practical completion would have been approximately 15 January 2024 (23 October 2023 + 51 days) having regard to the definition of days in cl 32 of the Building Contract; (g) at 11 October 2024 when Bahrami Group responded to the 18 September Moriarty Notice the works had not achieved practical completion and the default in proceeding with due diligence had continued. Bahrami Group did not in the 11 October 2024 Bahrami Group Response indicate or demonstrate that it was proceeding with due diligence to complete the works. As a result of these matters, Mr and Mrs Moriarty were entitled to terminate the Building Contract which they did on 6 November 2024; (h) Bahrami Group was liable for the cost to rectify 22 defective items for which the total cost of rectification was of $201,094.32 inclusive of GST. For these items where there was a contest as to whether the item was defective, he summarised the relevant evidence in the expert reports and concurrent oral evidence of Messrs Corbishley and Athari, and explained why he preferred the evidence of Mr Corbishley; (i) Mr Arnesa both supervised, coordinated and project managed the building work and also had substantive control over the building work. Applying the principles referred to in The Owners - Strata Plan No 87060 v Loulach Developments Pty Ltd (No 2) [2021] NSWSC 1068 (Loulach (No 2)) at [22]-[23], [42]-[43] and Sergienko v AXL Financial Pty Ltd [2019] NSWSC 1610 (Sergienko) at [46] the claim against Mr Arnesa for breach of the DBP Act was made out from the uncontradicted evidence of Mr Corbishley in the 5 May 2025 Corbishley Report and he was liable for the cost to rectify defective items of $201,094.32 inclusive of GST; (j) applying the applicable principles in the absence of evidence from Bahrami Group it would not be appropriate to make a work order as sought by it as the Tribunal did not have an appropriate degree of confidence that a work order would be implemented in a way that would bring about a final and complete resolution of the Moriarty Proceedings; (k) Mr and Mrs Moriarty were entitled to recover out of pocket expenses of $713.24 from the Bahrami Group.
On 16 July 2026, the Tribunal constituted by Senior Member D Goldstein made the 16 July 2026 Decision comprising:
orders including:
“2. In proceedings 2025/103453 Bahrami Group Pty Ltd must pay Damien Moriarty and Catherine Moriatry’s costs, such costs if not agreed to be assessed on the basis set out in the legal costs legislation as defined in section 3A of the Legal Profession Uniform Law Application Act 2014.
- In proceedings 2024/472065 Bahrami Group Pty Ltd and Omid Bahrami Arnesa must pay Damien Moriarty and Catherine Moriatry’s costs, the costs of 23 October 2025 to be paid on the indemnity basis, such costs if not agreed to be assessed on the basis set out in the legal costs legislation as defined in section 3A of the Legal Profession Uniform Law Application Act 2014.”
On 21 April 2026, Bahrami Group and Mr Arnesa appealed against the 24 March 2026 Decision by lodging a Notice of Appeal in which they:
challenged orders 2 and 3;
set out their grounds of appeal;
set out the orders sought;
sought leave to appeal on the ground that the Decision was against the weight of evidence.
On 11 May 2026, Mr and Mrs Moriarty lodged their Reply to Appeal in which they responded to each of the grounds of appeal and contended that leave to appeal should not be granted. In particular, they contended that none of the four grounds of appeal give rise to a question of law.
On 12 August 2026, Bahrami Group and Mr Arnesa lodged an Amended Notice of Appeal in which they appealed against the 24 March 2026 Decision and the 16 July 2026 Decision and they:
challenge orders 2 and 3 in each of those Decisions;
set out the following grounds of appeal (which repeat the grounds of appeal in the Notice of Appeal:
“I. Findings of Breach under the Design and Building Practitioners Act 2020 (NSW)
- The Tribunal failed to provide adequate, intelligible and proper reasons for finding that the second appellant breached the statutory duty of care imposed by section 37 of the Design and Building Practitioners Act 2020 (NSW) (“DBP Act”).
- The Tribunal erred in law by applying an incorrect legal principle or test in determining whether the second appellant had breached the statutory duty of care under section 37 of the DBP Act.
- The Tribunal failed to take into account a relevant consideration, namely:
a. the precautions which the second appellant ought reasonably to have taken in response to the foreseeable risks identified in the respondents’ expert evidence;
b. whether any such precautions were not taken; and
c. whether those precautions would have avoided, reduced or prevented the alleged defects.
- There was no evidence, or alternatively insufficient evidence, capable of supporting the finding of breach under section 37 of the DBP Act, in circumstances where there was no evidence as to:
a. the precautions the second appellant ought to have taken;
b. any failure to take such precautions; and
c. how the taking of such precautions would have avoided the alleged defects.
- The Tribunal failed to address substantial, clearly articulated submissions advanced by the second appellant concerning:
a. the proper test for breach under section 37 of the DBP Act; and
b. the respondents’ failure to establish the precautions allegedly required, any omission thereof, and causation.
- The Tribunal thereby erred in finding that the second appellant had breached the statutory duty of care under section 37 of the DBP Act.
II. Money Order in Lieu of Work Order
- The Tribunal failed to consider and apply section 48MA of the Home Building Act 1989 (NSW).
- The Tribunal erred by reversing the onus of proof in determining whether a money order ought to be made in lieu of a work order.
- The Tribunal failed to consider or address substantial and clearly articulated submissions made by the first appellant as to its intention, willingness and capacity to rectify the alleged defects.
- The Tribunal failed to consider whether the making of a money order was unfair or inequitable to the first appellant, having regard to section 79U(1) of the Fair Trading Act 1987 (NSW), in circumstances where the respondents had agreed to a suspension which caused the works to cease.
- The Tribunal thereby erred in making a money order in lieu of a work order.
III. Findings as to Termination of Contract
- The Tribunal erred in finding that the respondents validly terminated the contract on 6 November 2024 and further erred in failing to find that the contract remained on foot.
- The Tribunal failed to address substantial, clearly articulated submissions made by the second appellant regarding:
a. the legal effect of the correspondence exchanged between the parties from 26 April 2024 to 2 August 2024;
b. the status of the suspension of the contract; and
c. the submission that the contract was suspended by mutual agreement.
- The Tribunal erred in failing to find that the contract was suspended by agreement on 26 April 2024 at 5:31 pm.
IV. Findings as to Commencement Date and Practical Completion
- The Tribunal erred in finding that the commencement date under clause 10 of the contract was 16 June 2023, in circumstances where the respondents had not paid the deposit required under the contract as at that date.
- The Tribunal failed to apply clause 10(a)(iv) and the proviso to clause 10, pursuant to which the proper commencement date was 30 October 2023, being 20 days after the respondents paid the deposit in full.
- The Tribunal erred in determining the date for practical completion as 23 October 2023 (later extended to 15 January 2024). Properly construed, and applying the correct commencement date, the date for practical completion was:
a. 31 May 2024; or alternatively
b. 8 April 2024, calculated from the date upon which the works in fact commenced.
- The Tribunal erred in finding that the respondents’ notice of default dated 18 September 2024 was valid, in circumstances where the proper date for practical completion was:
a. 31 May 2024; or alternatively
b. 8 April 2024.”
“1. The appeal be allowed.
- Order 2 made in the proceedings below be set aside.
- In lieu thereof, pursuant to section 48O(1)(c) of the Home Building Act 1989 (NSW), a work order be made in the form annexed and marked Annexure B.
- Orders 2 and 3 made on 16 July 2026 in relation to costs be set aside.
- The respondents pay the first appellant’s costs of the proceedings below and of the appeal.
- Order 3 made in the proceedings below be set aside.
- In lieu thereof, the respondents’ claim against the second appellant for breach of the statutory duty of care under section 37 of the Design and Building Practitioners Act 2020 (NSW) be dismissed.
- The respondents pay the second appellant’s costs of the proceedings below and of the appeal.
- The respondents repay the sum of $201,807.56 to the first appellant within 14 days.”
seek leave to appeal on the grounds that the 24 March 2026 Decision was against the weight of evidence.
At the commencement of the hearing, we granted leave to Bahrami Group and Mr Arnesa to rely on their Amended Notice of Appeal subject to a condition which is no longer relevant. We also received as additional evidence the affidavit of Mr Arnesa affirmed on 23 June 2026 which was marked as exhibit A1.
Bahrami Group and Mr Arnesa relied on the following written submissions and their counsel made oral submissions:
submissions dated 23 June 2026 (the Bahrami Group/Arnesa Appeal Submissions);
submissions in reply dated 5 August 2026 (the Bahrami Group/Arnesa Appeal Submissions in Reply).
Mr and Mrs Moriarty relied on the following written submissions and their counsel made oral submissions:
submissions dated 23 June 2026 (the Moriarty Appeal Submissions);
further submissions dated 14 August 2026 (the Further Moriarty Appeal Submissions).
During the hearing, counsel for Bahrami Group and Mr Arnesa made the following concessions:
the challenge to the work order was only pressed if Bahrami Group was successful in ground of appeal 3;
the submission in relation to ground of appeal 1 that Mr Corbishley in the 5 May 2025 Corbishley Report did not specify that Mr Arnesa was a builder within the meaning of that term in the DBP Act was not pressed.
Section 80(1) of the Civil and Administrative Tribunal Act 2013 (NSW) (NCAT Act) allows a party to proceedings in which the Tribunal makes an internally appealable decision to appeal the decision to an Appeal Panel.
Internal appeals against an internally appealable decision may be made in the case of any kind of decision (including an ancillary decision) other than an interlocutory decision as of right on a question of law, or with the leave of the Appeal Panel on any other grounds: NCAT Act, s 80(2)(b).
The nature of a question of law within s 80 (2)(b) of the NCAT Act and applicable principles have been discussed in several recent Appeal Panel decisions: see for example Unique Commercial Group Pty Ltd v Cusumano [2024] NSWCATAP 204 (Unique Commercial Group) at [25]-[40]; and most recently, Star Training Academy Pty Ltd v Commissioner of Police, NSW Police Force [2026] NSWCATAP 127 at [24]-[33], [38]-[41]. Recently, the New South Wales Court of Appeal in Schwartz v Health Care Complaints Commission [2026] NSWCA 162 at [3]-[9] (Leeming JA, with Adamson JA at [108] and Griffiths AJA at [109] agreeing) referred to the “the often-stated yet often-ignored obligation to formulate grounds of appeal identifying a question of law” in relation to the analogous issue of an appeal under s 83(1) of the NCAT Act. We note the principle that it is necessary to articulate the question of law with precision.
The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are where it is satisfied that the appellant may have suffered a substantial miscarriage of justice because the decision of the Tribunal under appeal was not fair and equitable, or the decision of the Tribunal under appeal was against the weight of evidence, or significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with): NCAT Act, Sch 4, cl 12(1)(a), (b) and (c).
It is an established principle that an appeal court may order a new trial in a case where on conflicting evidence a verdict is found which is said to be against the weight of the evidence if it concludes that “the jury, viewing the whole evidence reasonably, could not properly find it; ... [t]he party seeking a new trial on this ground needs an exceptionally strong case because it must be shown that ‘the evidence so preponderates against the verdict as to shew that it was unreasonable and unjust’”: Calin v The Greater Union Organisation Pty Ltd (1991) 173 CLR 33 at 41-42 (Mason CJ, Deane, Toohey and McHugh JJ); [1991] HCA 23. This principle has been applied by the Appeal Panel in determining whether a decision of the Tribunal is against the weight of evidence within cl 12(1)(b) of Sch 4 of the NCAT Act: Collins v Urban [2014] NSWCATAP 17 at [77(2)].
“[133] The failure of a legally represented party to clearly articulate appeal grounds on errors on a question of law; and distinguish them from grounds requiring leave to appeal was discussed in Garofali v Moshkovich [2021] NSWCATAP 242 at [52]-[53] and [55] as follows:
“However, it is of no assistance to the Appeal Panel when a legally represented party cannot clearly identify and articulate what errors of law have purportedly occurred; nor clearly identify and articulate the distinction between purported errors of law (which do not require leave of the Tribunal) and errors other than errors of law to which leave to appeal is required.
This is not a new issue. The NSW Court of Appeal has been critical of practitioners who do not file and serve clearly articulated grounds of appeal and timely written submissions that engage with the grounds of appeal in Whyte v Broch (1998) 45 NSWLR 354 (‘Whyte’); Lorbergs v State of New South Wales (1999) NSWCA 54 and Lake Macquarie City Council v McKellar [2002] NSWCA 90 at [88]-[94]. In Whyte, Spigelman CJ referred to a pervasive “climate of complacency” regarding the failure of practitioners to file and serve timely outlines of submissions that engage with clearly articulated grounds of appeal.
…
However, all legally represented parties who appear in the Appeal Panel should, as a minimum standard, be able to clearly identify and articulate what are the purported errors of law or errors that require leave to appeal rather than merely provide a narrative as to why their client disagrees with the decision.”
Having regard to the principles in O*’*Brien at [133], regrettably we did not receive the assistance from the legal representatives of Bahrami Group and Mr Arnesa that we should have. The grounds of appeal in the Amended Notice of Appeal while asserting various errors fail to articulate any questions of law. Further, notwithstanding the contention of Mr and Mrs Moriarty in their Reply to Appeal that none of the four grounds of appeal in the Notice of Appeal give rise to a question of law and the submission in the Moriarty Appeal Submissions that ground of appeal 1 does not give rise to a question of law, neither the Bahrami Group/Arnesa Appeal Submissions) nor the Bahrami Group/Arnesa Appeal Submissions in Reply address this issue.
In these circumstances, we are not satisfied that any of the grounds of appeal of Bahrami Group and Mr Arnesa raise with sufficient particularity a question of law. It follows that this appeal is not as of right and Bahrami Group and Mr Arnesa will need to obtain leave to appeal.
Bahrami Group and Mr Arnesa in the Bahrami Group/Arnesa Appeal Submissions relevantly submit:
the deposit was not fully paid until 2 October 2023. Prior to 2 October 2023 when they paid progress claim no 1, Mr and Mrs Moriarty had not paid the full deposit under the Building Contract. The commencement date properly calculated in accordance with cl 10 and 32(e) is 30 October 2023, being 20 days after this date;
taking into account the correct commencement date under clause 10, the date for practical completion is 19 March 2024, subject to extensions. The Tribunal allowed an extension of 51 days (31 days for a suspension period and 20 days for the Bahrami Group to recommence after suspension). Accordingly, the correct date for practical completion, allowing for the extension granted by the Tribunal, is 3 June 2024;
the parties by the 26 April 2024 Moriarty Email suspended the works by agreement. The suspension was never lifted. Mr and Mrs Moriarty had no entitlement to terminate the Building Contract in circumstances where the building works were suspended by agreement. Accordingly, their purported termination of the Building Contract on 6 November 2024 by the 6 November 2024 Moriarty Letter is invalid, and it remains on foot.
The principles as to raising an issue on appeal which was not raised below were recently explained by the Appeal Panel in OPES Lifestyles Homes Pty Ltd v KMA Concrete Constructions Pty Ltd [2026] NSWCATAP 275 at [50]-[54].
We are not satisfied that the issue as to the commencement of the works was an issue before the Tribunal. Not only was there an admission as to the commencement date by Bahrami Group and Mr Arnesa in their Points of Defence, but also there were no submissions on this issue in their closing submissions. Accordingly, they should not be permitted to raise this issue in this appeal.
If, contrary to our finding, ground 4 can be raised in this appeal, the submissions of Bahrami Group and Mr Arnesa as to the commencement date of the works are manifestly without merit for the following reasons:
clause 10(a) when read with Sch 2 item 5(a) of the Building Contract on its proper construction selects the date that Mr and Mrs Moriarty notified Bahrami Group that they had finance to pay for the building works as the commencement date;
Mr and Mrs Moriarty fully paid the deposit required by Sch 2 item 4(a)(i) and (b) of the Building Contract before 23 June 2023 when regard is paid to the terms of the 15 November 2022 Bahrami Group Invoice.
We do not accept the submissions of Bahrami Group and Mr Arnesa that the parties by the 26 April 2024 Moriarty Email suspended the works by agreement and the suspension was never lifted for the following reasons:
Bahrami Group by the 26 April 2024 Arnesa Email validly suspended the building works pursuant to cl 21(a)(i) and (b) of the Building Contract;
the 26 April 2024 Moriarty Email on its proper construction does not constitute an agreement between Mr and Mrs Moriarty and Bahrami Group to suspend the building works. While neither party took the point on appeal, we disagree with the Tribunal that this Email constituted a direction by Mr and Mrs Moriarty to Bahrami Group not to proceed with the building works. However, even if it did constitute a direction by Mr and Mrs Moriarty to Bahrami Group within cl 21(c) of the Building Contract, it was ineffective because at the time the Email was sent the building works were already suspended. Rather than a direction, the Email was an acknowledgement that Mr and Mrs Moriarty that the building works were already suspended albeit expressed in the future tense;
Bahrami Group became bound pursuant to cl 21(d) of the Building Contract to recommence the building works within 20 days of 10 June 2024 when it received the 10 June 2024 Payment.
For these reasons we are not satisfied that Bahrami Group and Mr Arnesa may have suffered a substantial miscarriage of justice because the 24 March 2026 Decision was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act or against the weight of evidence within cl 12(1)(b) of Sch 4 of the NCAT Act. Even if we had been so satisfied, we would not have exercised the discretion under cl 12(1)(a) or (b) of Sch 4 of the NCAT Act to grant leave to appeal on this ground because this ground does not raise an issue of principle, a question of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable. It follows that ground 4 is not made out and we have decided to refuse leave to appeal on this ground.
36 Definitions
(1) In this Part—
…
building work includes residential building work within the meaning of the Home Building Act 1989.
construction work means any of the following—
(a) building work,
(b) the preparation of regulated designs and other designs for building work,
(c) the manufacture or supply of a building product used for building work,
(d) supervising, coordinating, project managing or otherwise having substantive control over the carrying out of any work referred to in paragraph (a), (b) or (c).
…
37 Extension of duty of care
(1) A person who carries out construction work has a duty to exercise reasonable care to avoid economic loss caused by defects—
(a) in or related to a building for which the work is done, and
(b) arising from the construction work.
(2) The duty of care is owed to each owner of the land in relation to which the construction work is carried out and to each subsequent owner of the land.
(3) A person to whom the duty of care is owed is entitled to damages for the breach of the duty as if the duty were a duty established by the common law.
(4) The duty of care is owed to an owner whether or not the construction work was carried out—
(a) under a contract or other arrangement entered into with the owner or another person, or
(b) otherwise than under a contract or arrangement.
41 Relationship with other duties of care and law
…
(3) This Part is subject to the Civil Liability Act 2002.
…
5B General principles
(1) A person is not negligent in failing to take precautions against a risk of harm unless—
(a) the risk was foreseeable (that is, it is a risk of which the person knew or ought to have known), and
(b) the risk was not insignificant, and
(c) in the circumstances, a reasonable person in the person’s position would have taken those precautions.
(2) In determining whether a reasonable person would have taken precautions against a risk of harm, the court is to consider the following (amongst other relevant things)—
(a) the probability that the harm would occur if care were not taken,
(b) the likely seriousness of the harm,
(c) the burden of taking precautions to avoid the risk of harm,
(d) the social utility of the activity that creates the risk of harm.
5D General principles
(1) A determination that negligence caused particular harm comprises the following elements—
(a) that the negligence was a necessary condition of the occurrence of the harm (factual causation), and
(b) that it is appropriate for the scope of the negligent person’s liability to extend to the harm so caused (scope of liability).
…
Mr Arnesa in the Bahrami Group/Arnesa Appeal Submissions:
relies on the principles in four judgements of the New South Wales Supreme Court: Loulach (No 2), The Owners - Strata Plan No 89005 v Stromer (No 3) [2022] NSWSC 1707 (Stromer (No 3)), The University of Sydney v Multiplex Constructions Pty Ltd (No 2) [2023] NSWSC 1019 (Multiplex Constructions (No 2)) and The Owners - Strata Plan No. 91684 v Parkview Constructions Pty Ltd [2025] NSWSC 493 (Parkview Constructions);
submits in relation to the evidence of Mr Corbishley in the table in Appendix A of the 5 May 2025 Corbishley Report that:
(a) column 5 for items 1, 4, 5, 8, and 27 in effect states that Mr Arnesa should have ensured that the defect does not exist. This is directly inconsistent with the principle in Loulach (No 2). The obligation under s 37 of the DBP Act is to exercise reasonable care to avoid economic loss caused by defects arising from construction work. It is not an obligation to “ensure” anything; (b) column 5 for items 6, 7, 10, 11, 12, 18, and 19 requires Mr Arnesa to have ‘checked’ the particular item. No further precautions are identified. No further details of the type of ‘checking’ is provided. For example, whether the ‘checking’ takes the form of an invasive inspection (or some other type of inspection), whether the ‘checking’ is conducted by Mr Arnesa himself, or some other qualified person engaged by or behalf of Mr Arnesa, and the timing of that ‘checking’; (c) column 5 for items 29 and 31 requires Mr Arnesa to inspect the work. This is analogous to ‘checking’ and therefore attracts the same criticism; (d) a precaution that simply requires ‘checking’ or ‘supervision’ attracts the same criticism as in Stromer (No 3); (e) column 4 invariably (other than for item 21) requires Mr Arnesa to ‘properly supervise’ the relevant item. No further precautions are identified including the timing of the required supervision, the type of supervision, and whether the supervision ought to have been conducted by Mr Arnesa personally or some other qualified person engaged by or behalf of Mr Arnesa; (f) column 4 item 21 requires the builder to research unspecified ‘documentation’ regarding the suitability of a ‘Stratco’ structure installed in close proximity to a swimming pool. No further precaution is identified, including how such research would have resolved the defect. The deck and stairs the subject of item 21 appear on the plans to be in close proximity to the swimming pool. The evidence does not demonstrate what Mr Arnesa ought to have done once the so-called ‘research’ was conducted. Was Mr Arnesa to seek a revision of the approved plans? Was he to obtain the opinion of a particular professional? Was he to construct the deck somewhere else, inconsistently with the plans? Notably, the Tribunal’s reasons at item 21 do not find liability on the basis of the proximity of the deck to the pool. It may be inferred that this basis was not accepted. Accordingly, the only precautions left are ‘failing to supervise’ and ‘failing to inform’ the owners of the change in the orientation of the deck. It is not articulated how those precautions would have avoided the defects; (g) the table utterly fails to identify the credible sequence of events. For example, even if Mr Arnesa ‘checked’ the relevant items, it is not articulated what Mr Arnesa would have learned, the potential scenarios that would have transpired, and how the defect would then have been avoided. Would a person complying with the duty contact a relevant (and specified) professional to seek advice? Would the person engage a particular contractor to carry out work in relation to that advice? Would the person himself carry out work? Similar to Loulach (No 2), the posing of these questions serve to illustrate that the manner in which Mr and Mrs Moriarty have identified the precautions has left their case on breach wholly unarticulated;
The granting of leave to appeal is not determinative of the appeal. The appellant must still establish an error of a type that causes the appeal to be allowed. We are satisfied that Mr Arnesa should be granted leave to appeal for the following reasons:
the definition of building work in s 36(1) of the DBP Act includes residential building work within the meaning of the HB Act;
the Tribunal has jurisdiction under s 48K of the HB Act to determine a claim for breach of s 37 of the DBP Act because such a claim falls within the definition of “building claim” in s 48(1)(a): Deaves v Sigma Group NSW Pty Limited [2023] NSWCATAP 94 at [78]-[81];
it is arguable that Mr Arnesa may have suffered a substantial miscarriage of justice because the 24 March 2026 Decision as against him was not fair and equitable within cl 12(1)(a) of Sch 4 of the NCAT Act or against the weight of evidence within cl 12(1)(b) of Sch 4 of the NCAT Act;
it is a question of general public importance as to the sufficiency of evidence necessary to establish a breach of s 37 of the DBP Act.
It is established principle that to give effect to the deeming in s 37(3) of the DBP Act, the duty in s 37 is to be treated as a common law duty and that a claim under the provision “must be treated as one brought under the common law for all purposes, including in addressing the application of the Civil Liability Act”: The Owners — Strata Plan No 84,674 v Pafburn Pty Ltd (2023) 113 NSWLR 105; [2023] NSWCA 301, at [70] (Basten AJA with Ward P at [1] agreeing); see also at [11] (Adamson JA). The effect of this principle as well as s 41(3) of the DBP Act is that the general principles of duty of care and causation in ss 5B and 5D of the CL Act apply to an action for breach of s 37 of the DBP Act. However, the proportionate liability provisions under Pt 4 of the CL Act do not apply to an action for breach of s 37 of the DBP Act against a builder or developer (Pafburn Pty L**imited v The Owners-Strata Plan No 84674 [2024] HCA 49; (2024) 421 ALR 133 at [51]-[65] (Gageler CJ, Gleeson, Jagot and Beech-Jones JJ)).
In Sergienko, the fourth and fifth defendants sought leave for Lawcover Insurance Pty Ltd (Lawcover) to be joined as a cross-defendant to the proceedings and to bring or continue the proceedings against Lawcover. Ward CJ in Eq at [62] refused leave. Her Honour:
having referred to Garzo v Liverpool/Campbelltown Christian School Limited [2011] NSWSC 292 (Garzo) dealt with the pleading of the elements required by s 5B(1) of the CL Act (at [46]-[47]):
“[46] In Garzo, Garling J emphasised the necessity that a pleading raising a claim in negligence to which the Civil Liability Act applies, must identify and articulate the material facts upon which the plaintiff relies to establish each of the elements required by s 5B(1) of that Act. His Honour said (at [60]-[61]):
As a starting point, a proper pleading of a claim requires the plaintiff to identify, and articulate clearly the “risk of harm” in respect of which, it is alleged, the defendant was obliged to take precautions. This puts a court in a position to determine the defendant’s knowledge of a specified risk of harm, to assess the probability of that risk occurring, and to evaluate the reasonableness of the defendant’s response, or lack of response, to that risk, thereby avoiding the type of error discussed by Gummow J in RTA v Dederer (2007) 234 CLR 330 at [59]-[61].
A proper pleading will also need to plead whether it is part of the plaintiff’s case that the defendant had actual knowledge of the risk of harm, and that the risk was thereby foreseeable (s 5B(1)(a)), or whether the plaintiff only contends that the defendant ought to have known of the risk of harm. Particulars of such a pleading would then ordinarily be provided. A defendant would then be in a position to fully plead to such allegation.
[47] At [63]-[64], his Honour emphasised the importance of identifying in the pleading of negligence the risk of harm:
A central concept and one with which the analysis commences is the identification of “a risk of harm” against which the plaintiff, here Mrs Garzo, alleges a defendant would be negligent for failing to take precautions. Harm in this expression includes personal injury. Gummow J, in Dederer at [59]–[61] clearly demonstrates that it is only through the correct identification of the risk of harm that an assessment of the reasonable response can be made.
As a real and practical matter, where a Court is considering any of the essential steps in s 5B(1), it must do so against the identified risk of harm. It is a matter of common experience in common law claims, that in any given set of factual circumstances, there are a number of risks of harm which can be identified. Unless the risk of harm being relied upon is clearly identified then it will not be possible to identify what steps ought reasonably to have been taken by a defendant to address the risk. Nor will it be possible for a Court to determine what the application of reasonable care required.”
“[52] Further, the failure of the pleading to identify the risk of harm and the reasonable precautions against that risk that is said were required gives rise to difficulties in relation to the case on factual causation under s 5D(1)(a). What the plaintiff must do is to identify the likely credible sequence of events which would have occurred but for the breach; …”
In Loulach (No 2), the plaintiff sought leave to amend its List Statement to include a claim for breach of the statutory duty of care created by s 37 of the DBP Act. In the proposed List Statement the plaintiff alleged that by reason of the specified defective construction work the second defendant breached the duty. Stevenson J at [45] declined to grant leave. His Honour:
rejected the submission that the mere fact that there was a defect which constitutes a breach of the statutory warranties in the HB Act established that the defect was the result of a breach by the builder of the statutory duty of care (at [22]-[23]);
by reference to three examples demonstrated that the identification of a defect does not of itself articulate the breach of the duty (at [24]-[34]);
stated that the DBP Act was not intended to provide a shortcut as to the manner by which a breach of a duty of care by a builder might be established (at [36]);
after setting out s 5B of the CL Act and quoting passages from authorities including Sergienko at [46] (at [39]-[41]), expressed the following conclusion (at [42]-[44]):
“[42] These authorities establish that a plaintiff alleging a breach of duty of care by a builder, and this must include a breach of the Statutory Duty of Care, must identify the specific risks that the builder was required to manage, and the precautions that should have been taken to manage those risks.
[43] It is not sufficient simply to assert a defect and allege that the builder was required to take whatever precautions were needed to ensure that the defect not be present.
[44] It may be, in this case, that the requisite degree of specificity can be achieved by causing the List Statement to refer to the Scott Schedule and revising the Scott Schedule to add further columns identifying, in relation to each defect, the relevant risk and, more importantly, exactly what the Owners Corporation contends Loulach should have done in relation to that risk.”
In Stromer (No 3), the second cross-defendant sought summary dismissal of the cross-claim against it. In the proceedings the plaintiff brought a claim against the fourth defendant builder under s 18B of the HB Act 1989, and the builder brought a cross-claim against the second cross-defendant building supervisor under s 37 of the DBP Act, alleging that the building supervisor ought to contribute to, or indemnify it in respect of any liability it has to the plaintiff. The builder provided particulars in the form of a scott schedule which described the defect and alleged, in almost all cases, that the building supervisor failed to ‘construct or supervise’ the relevant work in a way that would have avoided the defect in question. Ball J at [13(1)] struck out the relevant paragraphs of the cross-claim. His Honour:
set out the requirements of an adequate pleading of breach of duty under s 37 of the DBP Act (at [6], [9]):
“[6] In my opinion, the particulars provided by the Builder are not an adequate solution to the problem with its pleading. An allegation that the Building Supervisor failed to take adequate steps to prevent the relevant harm from occurring without identifying what those steps were is not a proper pleading of negligence. What the Builder must do is identify the particular actions that are said that a person in the position of the Building Supervisor acting reasonably would have taken to avoid the relevant risk of harm. It then needs to allege that had the Building Supervisor taken those steps the harm would not have occurred.”
“[9] In order to plead a proper case of negligence, it would be necessary for the cross-claim, for example, to allege that a reasonable person in the position of the Building Supervisor would have taken certain steps (such as inspected the construction of each cavity wall flashing at identified intervals) and that had they taken those steps they would have identified the problem and would have taken certain steps to rectify it. …”
by reference to an example drew a distinction between alleging an absence of reasonable care and alleging a failure to prevent a defect (at [7]-[8]).
In Multiplex Constructions (No 2), the plaintiff sought leave to file a further a further List Statement which included claims against the sixth defendant McKenzie Group Consulting (NSW) Pty Ltd (McKenzie) which it engaged as a certifying consultant in relation to certain façade panels. The plaintiff no longer sought to propound a case as against McKenzie under s 37 of the DBP Act 2020 and reformulated its claims against McKenzie for breach of duty and for misleading or deceptive conduct. Stevenson J at [59]-[60] refused to grant leave to the plaintiff to amend its breach of duty case against McKenzie because of its unclear allegations. His Honour:
found that the pleading of reasonable precautions a person in the position of McKenzie would have done as a precaution against the risk of using the façade panels to be confused and confusing (at [29]-[36]);
having referred to Sergienko at [52], found that the pleading of causation was unclear. It was not sufficient for the plaintiff to allege that had McKenzie acted in accordance with its alleged duty, it would probably have arranged for the façade panels to be removed and “an alternative compliant product installed in their place”. Simply to allege that this “probably” would have happened without identifying, in any way, what “credible sequence of events” might have achieved this result, places McKenzie in the position where it has no idea what case it has to meet. It is incumbent on the plaintiff to identify the “potential scenarios” whereby it contends that McKenzie acting in accordance with its alleged duty would lead to the replacement of the façade panels with “compliant product” (at [37]-[49]).
In Parkview Constructions, the defendant builder sought leave to amend its cross-claim list statement against a fire engineer, an architect, and a certifier against in which the builder sought compensation should it be found liable to the plaintiff in relation to allegedly combustible aluminium composite cladding. Stevenson J at [39]-[40] refused leave as against the fire engineer and the architect, but granted leave as against the certifier which did not oppose the amendments. His Honour, citing Sergienko at [52] and Multiplex Constructions (No 2) at [42], dealt with the proper pleading of causation (at [10]):
“[10] When a party alleges that but for the impugned conduct of a party a particular circumstance would or would not have come about, it is important for the pleading to “identify the likely credible sequence of events which would have occurred” but for the impugned conduct that would have led to that result.”
We are not satisfied that any of Sergienko, Loulach (No 2), Stromer (No 3), Multiplex Constructions (No 2) and Parkview Constructions) are of relevance to the issues in this appeal. They were all concerned with the adequacy of a pleading or proposed pleading in proceedings in the New South Wales Supreme Court. There are no formal pleadings in the Tribunal. On the contrary, the Tribunal pursuant to s 38(4) of the NCAT Act is required to act with as little formality as the circumstances of the case permit and according to equity, good conscience and the substantial merits of the case without regard to technicalities or legal forms. Further, the Tribunal in considering whether a breach of s 37 of the DBP Act had been established had regard to the 5 May 2025 Corbishley Report rather than the Moriarty Claim.
We have found helpful the judgment of the New South Wales Court of Appeal in Kazzi v KR Properties Global Pty Ltd t/as AK Properties Group [2024] NSWCA 143 (Kazzi). The appellant and cross-respondent, Pierre Kazzi (Mr Kazzi), was the sole director, shareholder and nominated supervisor of Oxford (NSW) Pty Ltd (Oxford), a building company. The respondents and cross-appellants (the Owners) contracted with Oxford to construct a six-unit apartment building on land in Gerringong. The date stipulated in the contract for practical completion of the building works was 4 July 2017. Oxford did not complete the works by that date. On 5 April 2019, the Owners terminated the contract. In January 2020, Oxford commenced proceedings against the Owners to recover outstanding amounts pursuant to invoices it had served under the contract. The Owners brought a cross-claim against Oxford and Mr Kazzi, seeking damages from Oxford for breach of contract in relation to the costs they incurred to complete the building works and rectify defective works, and damages from Mr Kazzi for breach of the duty in s 37 of the DBP Act.
The primary judge (Stevenson J) delivered four judgments in the proceedings. In the first judgment the primary judge relevantly dismissed the Owners’ claim against Mr Kazzi: Oxford (NSW) Pty Ltd v KR Properties Global Pty Ltd trading as AK Properties Group ABN 62 971 068 965 [2023] NSWSC 343.
There was an appeal and a cross-appeal. The Owners filed a cross-appeal which sought judgment against Mr Kazzi in the sum of $918,545.46. The Owners alleged that the primary judge erred in finding that they had failed in their claim against Mr Kazzi for damages for breach of his statutory duty under s 37 of the DBP Act in relation to 14 defects. Specifically, the Owners took issue with (1) his Honour’s finding that the Owners had not established that Mr Kazzi breached his statutory duty in relation to those defects (ground 2); (2) his Honour’s finding that the Owners had not proved their loss (ground 3); and relatedly, (3) his rejection of the evidence of Mr Mahedy who was the Owners’ expert witness relating to the calculation of the Owners’ loss (ground 4).
We are satisfied that r 38 of the Civil and Administrative Tribunal Rules 2014 (NSW) was applicable to the Moriarty Proceedings and the Bahrami Group Proceedings and so r 38A(2) is applicable to this appeal. We are also satisfied that the amount in dispute on this appeal is more than $30,000.00: Allen v TriCare (Hastings) Ltd [2017] NSWCATAP 25 at [57].
Counsel for Bahrami Group and Mr Arnesa agreed that if they were wholly unsuccessful then the costs of the appeal should follow the event. We are satisfied that this concession was correctly made.
As Mr and Mrs Moriarty have been wholly successful, we have decided that Bahrami Group and Mr Arnesa should pay their costs of the appeal on the ordinary basis as agreed or assessed.
We make the following orders:
In respect of the appeal against orders 2 and 3 made on 24 March 2026:
(a) as to ground 1, leave to appeal is granted and the appeal is dismissed; (b) as to grounds 2 to 4, leave to appeal is refused.
**********
I hereby certify that this is a true and accurate record of the reasons for decision of the New South Wales Civil and Administrative Tribunal.
Registrar
I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales. Registrar
Bahrami Group Pty Ltd
Moriarty
[2026] NSWCATAP 275
[2026] NSWCATAP 127
[2026] NSWCATCD 65
(1991) 173 CLR 33
(2024) 421 ALR 133
(2017) 95 NSWLR 597
(2023) 113 NSWLR 105
(1998) 45 NSWLR 354
(2007) 234 CLR 330
Before determining these issues, we have summarised the background to the appeal, the history of the appeal and the jurisdiction and approach of the Appeal Panel.
Only if the decision is attended with sufficient doubt to warrant its reconsideration on appeal will leave be granted. Ordinarily, it is only appropriate to grant leave where there is an issue of principle, a question of general public importance, or an injustice which is reasonably clear, in the sense of going beyond what is merely arguable. It is well established that it is not sufficient merely to show that the decision was arguably wrong: Secretary, Department of Family and Community Services v Smith (2017) 95 NSWLR 597; [2017] NSWCA 206 at [28] (Gleeson JA with Macfarlan JA at [1] and Payne JA at [67] agreeing). Further, it should be established that, to leave any putative error uncorrected, would give rise to a substantial miscarriage of justice: Hungry Jack*’*s Pty Ltd v Fourtounas [2020] NSWCA 325 at [9] (Basten JA with White JA at [18] agreeing); cited with approval together with another authority in Unique Commercial Group at [42]-[43]; see also Collins v Urban at [84(2)].
Except where the appeal is a new hearing under s 80(3) of the NCAT Act, the appeal is a rehearing on the materials before the Tribunal and any additional or further evidence received to determine whether the orders that are the subject of the appeal are the result of some legal, factual or discretionary error: Yuen v Thom [2016] NSWCATAP 243 at [14]-[22].
The Appeal Panel may make such orders as it considers appropriate in light of its decision on the appeal, including an order that the appeal is to be dismissed: NCAT Act, s 81(1)(a).
If, contrary to our finding, ground 3 can be raised and grounds 3 and 4 raise a question of law and Bahrami Group and Mr Arnesa has a right of appeal, then for the reasons already given we would not have been satisfied that the Tribunal made an error in finding that the construction period commenced on 16 June 2026 and Mr and Mrs Moriarty by the 6 November 2024 Moriarty Letter validly terminated of the Building Contract pursuant to cl 28(a)(ii). We would have dismissed the appeal on these grounds pursuant to s 81(1)(a) of the NCAT Act.
The Court allowed the cross-appeal. Mitchelmore JA at [41]-[149] (with Gleeson JA at [1] and Basten AJA at [176] agreeing) held that Mr Kazzi breached his statutory duty of care in respect of the defective work on which the Owners relied, by making decisions, as nominated supervisor of the works, as to the progress and manner of the works that gave rise to the defects. Her Honour relevantly:
noted that Mr Mahedy had prepared an expert report in which he set out the major defects in the building works by reference to the development consents, the two construction certificates, the BCA and Australian Standards, and “standard construction industry practice” (at [57]);
noted that Mr Mahedy set out the “[p]recautions which a reasonable person would have taken” which the primary judge rejected as evidence of the facts asserted (at [59]);
noted that Mr Mahedy was not cross-examined on his expert report (at [65];
considered the evidence in relation to each of the 14 defects (at [83]-[125]). She rejected the submission of Mr Kazzi that the Owners did not lead any evidence that the decision to use a particular product was negligent, and accepted the submission for the Owners that that decision, and the departure from the approved drawings that it entailed, involved a breach on the part of Mr Kazzi of the duty in s 37 of the DBP Act to take reasonable care to avoid economic loss caused by defects (at [90]);
concluded that Mr Kazzi breached his statutory duty of care, as the nominated supervisor of works, by making decisions as to the progress and manner of the works that gave rise to the defects on which the Owners relied (at [126]).
Taking into account the approach in Kazzi, we are satisfied that the Tribunal did not err in finding that Mr Arnesa breached s 37 of the DBP Act in view of the following evidence:
the unchallenged evidence of Mr and Mrs Moriarty that Mr Arnesa both supervised, coordinated and project managed the building work and also had substantive control over the building works;
the unchallenged evidence of Mr Corbishley in the table in Appendix A of the 5 May 2025 Corbishley Report as to defective items by reference to the National Construction Code and Australian Standards, and the failure to take reasonable precautions;
the written and oral evidence of Mr Corbishley which was accepted by the Tribunal.
For these reasons this ground is not made out, and the appeal on this ground should be dismissed pursuant to s 81(1)(a) of the NCAT Act.
If, contrary to our finding, this ground raises a question of law and Mr Arnesa has a right of appeal, then for the reasons already given we would not have been satisfied that the Tribunal erred in finding that Mr Arnesa breached s 37 of the DBP Act and would have dismissed the appeal on this ground pursuant to s 81(1)(a) of the NCAT Act.