before starting any work under the contract. Penalty: 100 penalty units.

(2) For the purposes of subsection (1), the Governor in Council may make regulations fixing a higher dollar amount than that referred to in subsection (1).

(3) If a builder does not comply with subsection (1), the building owner may avoid the contract at any time before it is completed.

(4) However, subsection (3) does not apply if VCAT believes it would be unfair in the particular circumstances of a case for a building owner to do this".

1. Paragraph 3 of Schedule 1 to the contract provided that the deposit to be paid pursuant to clause 9 was "$20,389.70 (5.00% of Contract Price)" of $407,794.00.
2. On 27 July 2018, when the contract was executed, Mr Dawn paid the deposit of $20,389.70 to Carlisle. On that day, Mr Dawn also paid to solicitors, Enterprise Legal Group Pty Ltd ("Enterprise Law"), the sum of $40,779.40. The trust account receipt given to Mr Dawn records that the "purpose" of the payment was as "Final completion payment for CARLISLE" and that the "client" was "Carlisle Homes".
3. Mr Dawn paid the sum to Enterprise Law after receiving a letter from Ms Caparello of Carlisle dated 24 July 2018. The first paragraph of the letter refers to a "Cash Client Trust Account Introduction Letter". I have been unable to find a copy of the Introduction Letter in the documents produced by the parties. I have assumed that its terms are consistent with the letter dated 24 July 2018, the Enterprise Law trust account receipt and the terms of the authority to release funds which Mr Dawn was sent with the email from Carlisle dated 26 February 2019.
4. The letter dated 24 July 2018 was signed by Mr Dawn on 27 July 2018 with an acknowledgement that, "I, David-Jon Robert Dawn agree with the terms of this letter". The letter reads in part as follows:

"We refer to our Cash Client Trust Account Introduction Letter, which we sent to you explaining that you would be required to pay your final completion payment (as set out in your HIA New Homes Building Contract) into the Enterprise Law Trust Account prior to your site start.

We now provide the details for you to make payment of your final completion payment so we can commence construction. We confirm that payment is required at least two (2) weeks prior to allocating a site start date. ...

We confirm the final completion payment you are required to pay is: $40,779.40. ...

• Authorise Enterprise Law to invest the deposit in an interest bearing account;
• Authorise Enterprise Law to, at any time, withdraw the moneys from an interest bearing account and hold the moneys and interest accrued in Enterprise Law's trust account; ...

Any interest which accrues on your payment will be paid to you after the appropriate release document has been signed by all parties, with the balance being paid to Carlisle Homes in payment of the final Completion amount".

1. The amounts to be paid under the contract at the various stages of work are set out in Schedule 3 to the contract. The "Completion" payment of $40,779.40 (10% of the contract price) was to be paid as that stage of the works "as defined in s40(1) of the [DBCA]".
2. The completion stage is not defined in s40(1). All other stages are and, together with a 5% deposit, not more than 90% of the contract price would already have been claimed and paid by the time the works were completed, leaving a 10% final payment.
3. The issue for determination is whether the payment or lodgement of $40,779.40 involved Carlisle making a "demand" for, or it having "receive[d]", a further deposit in addition to the 5% deposit of $29,389.70 payable under the building contract.
4. The payment of the 5% deposit was expressly provided for in the building contract. The lodgement of the final payment was not provided for in the building contract but was the subject of correspondence at about the time the building contract was signed.
5. A "deposit" is usually a payment made to demonstrate the "good faith" of a party entering into an agreement that they will carry it through to conclusion. If they do not, they will often forfeit the deposit. For example, in the context of a contract for the sale of land, if a deposit were not paid by the purchaser, the vendor may be reluctant to enter into a binding exclusive arrangement if there were no commitment by the purchaser to pay a deposit that would demonstrate that they would finalise the purchase when required.
6. With building contracts, a deposit may also be a recognition that a builder is required to spend some time and cost in the preparation of a quotation and the finalisation of certain details of the works before a final quotation or contract price can be ascertained. Also, a deposit recognises that a builder must "gear-up" before construction work can start, and that expense will be incurred for matters such as the allocation of staff, engagement of sub-contractors, planning the sequence of works, establishing site facilities, and updating the necessary insurances for the project.
7. Mr Dawn signed a document headed "Order Building Process" that set out 15 steps from "Step 1 New Home Selection" to Step 15 Completion of Works". The signature acknowledged that Mr Dawn understands "the initial deposit and further deposit is non-refundable as it will be used by Carlisle Homes for tasks including (without limitation) all sales and administrative costs to process your purchase and third party costs for any necessary certificates, information reports and drawings".
8. On the other hand, an arrangement between parties to a building contract that an owner put the final payment in trust with a third party might be regarded as a form of security that the final 10% of the contract price will be available at the end of the project, particularly where the project was self-funded, rather than through a financial institution.
9. In my view, such an arrangement does not involve the payment or receipt of a further deposit in addition to the contract deposit of 5% of the contract price, for the following reasons:
   1. the further sum was lodged with a third party, Enterprise Law. Although Enterprise Law was Carlisle's solicitors, the money paid to it by Mr Dawn was held by Enterprise Law until "after the appropriate release document has been signed by all parties". The final payment was, therefore, not paid by Mr Dawn or received by Carlisle until after the further release document was signed by both parties;
   2. the purpose of the payment was not as a "deposit", except in the sense that money was "deposited" with Enterprise Law. It was essentially the provision of security to ensure that sufficient funds would be available from which the final payment could be made when it became due.
10. Even if s11 of the DBCA had been breached, Mr Dawn did not seek to avoid the building contract. Paragraph 6F of the FAPD does no more than set out the statutory entitlement in s11(3) that Mr Dawn may "avoid the Contract at any time before it is completed".
11. At no time, prior to the issue of the proceeding, did Mr Dawn assert in correspondence with Carlisle that he was avoiding the building contract. In the proceeding, Mr Dawn's FAPCC does not claim that the building contract has been avoided, and does not claim other relief in the proceeding on the basis that the building contract had not been "completed" before the proceeding was issued. In fact, Mr Dawn claimed liquidated damages for delay on the basis that the building contract had not been, and would not be, terminated.

1. Was the requirement for Mr Dawn to lodge the sum of $40,779.40 with Enterprise Law contrary to s40(3) of the DBCA?

1. Mr Dawn alleged that s40(3) of the DBCA prevented Carlisle from requiring him to lodge the sum of $40,779.40 with Enterprise Law. Paragraphs 6G and 6H of the FAPD provide, as follows:

"6G In the alternative to paragraph 6E, by demanding the full payment of the Completion Stage before the building works had commenced, the Applicant breached s40(3) of the DBCA by demanding or receiving any amount of instalment that is not directly related to the progress of the building work being carried out under the contract.

The respondent [applicant] demanded the payment of the 'Completion' Stage of the work which is the final stage in the Method 2 Progress Payment table in Schedule 3. The applicant was not entitled to demand this stage of the work before it was completed.

6H By reason of the matters set out in paragraph 6G, the respondent is entitled to avoid the payment of the final claim.

The respondent relies on the reasoning in Stephens v Cameron [2021] VSCA 208 at [96] - [97]".

1. In paragraph 6 of Carlisle's ARDCC, it pleads to "paragraphs 6G and 6H" of the FAPD, as follows:

"6. Section 40(3) of the DBCA does not apply to this Contract as:

1. the Contract is a 'contract to build all stages' and therefore is one of the types of contracts listed in the Table in section 40(2); and

b. the parties agreed that subsections (2) and (3) do not apply".

(2) A builder must not demand or recover or retain under a major domestic building contract of a type listed in column 1 of the Table more than the percentage of the contract price listed in column 2 at the completion of a stage referred to in column 3.

(3) In the case of a major domestic building contract that is not listed in the Table, a builder must not demand or receive any amount or instalment that is not directly related to the progress of the building work being carried out under the contract.

(4) Subsections (2) and (3) do not apply if the parties to a contract agree that it is not to apply and do so in the manner set out in the regulations".

1. Regulation 13(1) of the Domestic Building Contracts Regulations 2017 (Vic) provides that:

"For the purposes of s 40(4) of the Act, when parties to a major domestic building contract agree that section 40(2) and (3) of the Act do not apply to that contract, the manner of agreement is to include in the major domestic building contract -

(a) a warning in the form of Form 1 in Schedule 1, which is signed by the building owner before the building owner signs the major domestic building contract; and

(b) a clause in the form of Form 2 in Schedule 1, which is signed by the building owner and the builder before they sign the major domestic building contract".

1. In the building contract, both a "warning in the form of Form 1" and a "clause in the form of Form 2" are included as pages 10 to 12. It is likely because of where they appear in the building contract that they were signed before the signatures to the building contract at page 19 were affixed.
2. Sections 132 and 133 of the DBCA have previously been set out in section d. of these reasons. These provisions have no relevance to the present dispute because s132(1) is "subject to any contrary intention set out in this Act". That contrary intention is contained in s40(4) of the DBCA. Accordingly, this ground of defence must fail.

1. Did Mr Dawn satisfy his obligation to make the Final Payment by proffering the signed release on 22 March 2019, thereby becoming entitled to possession?

1. By paragraph 6A of his proposed further amended points of defence dated 17 October 2022, Mr Dawn alleged that "on or around 22 March 2019... the Respondent tendered to the Applicant the sum of $40,779.40, being the sum claimed by the Applicant herein, but the Applicant refused to accept the same". Mr Dawn, giving particulars of the "tender", alleged that, he "provided the Applicant with a written letter authorising the release of the final completion payment to the Applicant. ... The letter was signed by the Applicant 'under protest'. The Applicant refused to accept the authorisation letter approving payment at the settlement meeting".
2. Mr Dawn alleged in paragraph 6B of the FAPD that, "By reason of the matters set out in paragraph 6A herein, the Applicant was not and is not entitled to maintain this action against the Respondent".
3. Mr Dawn indicated in the proposed pleading that he relied upon the decisions of Scott v Uxbridge and Rickmansworth Railway Co (1866) LR 1 59 (as followed in Australian Mid-Eastern Club Ltd v Yassim (1989) 1 ACSR 399).
4. Carlisle responded in its proposed ARDCC dated 22 November 2022 by referring to its email to Mr Dawn on 22 March 2022 following the settlement meeting, in which it "agreed to settle on receipt by the Applicant of the Trust Release Authorisation Letter signed by the Respondent with the notation 'Settled Under Protest', but the Respondent has failed and/or refused to resubmit the Trust Release Authorisation Letter to the Applicant until the Applicant has carried out all of the works which the Respondent claims are required to bring the Building Works to Completion", and that, Mr Dawn thereby "changed his position from being prepared to release the funds held on trust to the Applicant, to one of refusing to release the funds held on trust unless and until the Applicant rectifies all of the defective work which the Respondent claims to exist".
5. The following facts are not disputed:
   1. the release authorisation produced by Mr Dawn at the settlement meeting was in the form provided to him by Carlisle with the email from Carlisle's General Counsel, Melanie Hogg, dated 26 February 2019;
   2. the release authorisation was signed by Mr Dawn and it was offered unconditionally to Ms Constantopoulos of Carlisle to enable the payment of the Final Claim to be made by Enterprise Law to Carlisle;
   3. the release authorisation noted that the settlement was being made by Mr Dawn "under protest".
6. In Australian Mid-Eastern Club v Yassim (1989) 1 ACSR 399 at [403], Meagher JA stated that:

"There is ample authority that the proffering of cash or its equivalent in the full amount demanded constitutes a valid tender, even if proffered 'without admissions' or 'under protest', provided only it is unconditional".

1. In my view, it is clear that on 22 March 2019, Mr Dawn's offering of the signed release authorisation was sufficient compliance with his obligation to make the final payment and to avoid being regarded as in breach of the building contract. Mr Dawn's amended points of defence asserted that, as a consequence of these matters, "the Applicant was not and is not entitled to maintain this action against the Respondent.
2. However, as Meagher JA also stated at [403], "If a valid tender be made, a refusal of that tender (whether for good or bad reason, or for no reason at all) does not eliminate the debt in question. The relationship of creditor and debtor still subsists. The tender is no answer to a claim for the debt unless (as did not happen here) there is a continued readiness to pay, coupled with an actual payment into court".
3. Following the settlement meeting on 22 March 2019, Mr Dawn refused to make it possible for the final payment to be released by Enterprise Law by failing to authorise Carlisle to use the copy of the release document it held, and later in failing to provide the original copy of the release document.
4. Mr Dawn also changed his position and, by email dated 27 March 2019, asserted that Carlisle was not entitled to the final payment because the works were not complete. By these actions, Mr Dawn effectively negated his offer of the release document at the settlement meeting on 22 March 2019.

1. The competing claims in this regard are:
   1. Carlisle claims the liquidated amount of $500.00 per week specified in clause 38.5 of the building contract as the cost of maintaining the property after completion, together with interest on the unpaid final claim.
   2. Alternative claims by Carlisle that it is entitled under cl. 34 of the building contract to extensions of time "until such time as [Mr Dawn] allows [Carlisle] to install the appliances" with "agreed damages of $250.00 per week... from 22 March 2019 until the appliances are installed".
   3. Mr Dawn claims liquidated damages of $250.00 per week specified in cl. 41 of the building contract or, alternatively, common law damages as a consequence of the delayed "completion" of the contract works.
   4. Mr Dawn also claims accrued interest on the funds held on trust by Enterprise Law.

Is Carlisle entitled to a maintenance cost of $500.00 per week?

1. Carlisle relies upon cl. 38.5 of the building contract to claim "settlement damages" of $500.00 per week. Clause 38.6 also has some relevance. The clauses provide as follows:

1. the Builder has provided the Owner with written notice that the works under Clause 37.2 have been completed (in accordance with Clause 37.3); or
2. the Owner does not list any known defects or incomplete work; and
3. the Owner has failed to pay the Final Claim and take Possession as required under the Contract, the Owner is liable to pay Settlement Damages as defined in the Special Conditions".

38.6 Where the Owner pays the Final Claim but does not take Possession of the Land or any part of the Land, the Owner agrees and acknowledges that it, the Owner must:

1. insure the property and provide such details to the Builder;

1. release, discharge and indemnify the Builder in relation to any claims, demands and costs relating to the security of the property".

1. Clause 20.1 of the building contract also makes provision for the insurance of the property if the Owner fails to take possession. Clause 20.1 provides as follows:

"The Builder must maintain the insurance from the date the Owner gives the Builder Possession of the Land under Clause 25 to the earlier of:

• the date that the Owner takes Possession of the Land or any part of the Land; or
• the date the Builder hands over Possession of the Land.

The Owner must pay the Builder a reasonable amount to cover the pro-rata cost of the insurance for any period during which the Final Payment is unreasonably withheld from the date the money is due".

1. Clause 20.0 provides that the insurance must be in the names of the Builder and the Owner and cover "against liability for physical loss, destruction or damage to the Building Works and the goods and materials on the Land as described in the Contract Documents [and] must indemnify the Owner in respect of and insure against liability for personal injury, death, property loss or damage arising out of the Building Works".
2. Special Condition 13 "Settlement Damages", in Schedule 4 to the building contract, relevantly provides as follows:

"The term 'Settlement Damages' shall mean those sums that the Builder is entitled to be paid by the Owner as damages, to compensate the Builder in the following circumstances:

(i) To compensate the Builder for those expenses to secure and maintain the property in the circumstances described at Clause 38.5 of the General Conditions, in the amount of $500 per week; ...".

1. There are, in addition, orders of the Tribunal which affect the operation of the provisions of the building contract. They arise from two successful applications for the adjournment of the hearing, which were granted on terms that the delay caused by the adjournment would, or may, affect a party's entitlement to delay costs.
2. On 23 March 2021, the final hearing date previously fixed for that day was refixed by Senior Member Walker for 22 February 2022 upon application by Carlisle as a result of one of its witnesses being "seriously ill and unable to give evidence". The adjournment was granted upon "the undertaking of the Applicant by its counsel that, if it is successful in the proceeding, it will not claim interest or liquidated damages for the period commencing today and the date fixed for the hearing". The reference to "liquidated damages" was obviously a reference to the "settlement damages" claimed by Carlisle under cl. 38.5 of the building contract.
3. As a result of the COVID epidemic, the hearing could not proceed on 22 February 2022 and the proceeding was refixed for hearing on 8 August 2022.
4. On 11 July 2022, the hearing date of 8 August 2022 was refixed by me for 17 October 2022 upon application by Mr Dawn because he anticipated being overseas on the original hearing date. I made a further order that, "Paragraph 6 of the orders made by Senior Member R. Walker on 23 March 2021 will have continuing effect on the basis that the reference to the hearing date refers to the hearing date of 22 February 2022. The questions of interest and any damages to which the applicant is entitled after that date shall be determined by the Vice President hearing the matter".
5. Carlisle claims "Settlement damages" of $500.00 per week, as specified in the building contract. Mr Dawn denies Carlisle's entitlement to make this claim. He also disputes the figure claimed by Carlisle. In his final written submissions, Mr Dawn relied upon alternative legal bases in submitting the amount claimed was excessive, including Australian Consumer Law.
6. Although these defences were not foreshadowed by Mr Dawn in the formal pleadings, I consider that it is appropriate to consider whether the sum specified in the contract was a genuine pre-estimate.
7. Mr Tabak gave oral evidence that until about December 2020, Carlisle was carrying out works at the property to complete items from lists prepared as a result of inspections by Mr Dawn, DBDRV and Mr Smith. After that time, Mr Tabak agreed with the question that, "The only works that you've carried out are what you describe as maintenance works".
8. Mr Tabak also agreed that "the sum of $500 [is] a sum which applies across all of the domestic building contracts that you [Carlisle] enter into with your customers", of which there are "approximately 1700" new contracts each year.
9. Mr Tabak gave evidence of a number of specific tasks which had been performed since about December 2020, being the date after which only "maintenance work" was carried out at the site. These works were:
   • "regularly a gardener come in with us doing the weeds".
   • "painters come in numerous times for staining timbers outside".
   • "we had a plasterer inside doing some settlement [work]. ... when [there was] cracking in the plaster, [we] had the plasterer back in there and the painter back in there".
   • "I've had the garage door replaced because it was dinted, it was damaged".
   • "I've had electricians there because the lights were deteriorating, so we've replaced those lights".
   • "I've had a plumber there who replaced a handful of downpipes. They've either been scratched or they were starting to".
   • "I've had a plumber there on the roof inspecting the box [gutter] to make sure it's not filled up with debris".
   • I've "had a painter paint".
   • "Cleaner. I've had numerous cleans done on the house".
10. On 5 May 2021, Ms Hogg had informed Mr Dawn's solicitors in an email that, "the following security and maintenance work commenced after 27 March 2019, being the date your client failed to take possession of the home:
    • Routine lawn mowing/gardening;
    • Routine inspections by our employees;
    • Installation of security cameras;
    • Installation of plastic to ground floor windows and a timer light to make the home appear occupied;
    • Cleaning the external brickwork, after your client defaced the majority of the external bricks with chalk on 23 October 2019;
    • Repair of hairline cracks in architraves and cornices, caused by normal seasonal movement deemed by your client's expert to be minor shrinkage and of low concern;
    • Cleaning of efflorescence from brickwork; and
      • Cleaning of laundry sink and handrail corrosion, consistent with an unoccupied home and deemed by your client's expert to be of low concern".
11. Mr Tabak was asked, "In regard to the $500 a week, is that a sum that represents a reasonable estimate of what it would cost for Carlisle to maintain a house that's been basically completed but remains unoccupied?" Mr Tabak replied, "I couldn't comment on the value myself but knowing that there's more costs involved, not just the maintaining. You've got - you've got power to cover off on, you got - we've had - at that point in time we've had, ah, security cameras up there, we've had a supervisor calling past regularly just to make sure nothing's been damaged".
12. In relation to the insurances affecting the property, Mr Tabak said, "It's ongoing because we've still got to insure the property because it's not handed over yet".
13. I am satisfied that Carlisle is entitled to be paid by Mr Dawn "settlement damages" as defined in Special Condition 13 in Schedule 4, and pursuant to cl. 38.5 of the building contract. In reaching that conclusion, I rely upon the following matters:
    1. Carlisle provided Mr Dawn "with written notice that the works under Clause 37.2 have been completed (in accordance with Clause 37.3)" by the email correspondence leading up to the settlement meeting on 22 March 2019;
    2. Mr Dawn "failed to pay the Final Claim and take Possession as required under the Contract" by failing to pay the final claim or to provide a signed authority to Enterprise Law to release funds it held, after he was requested to do so by Carlisle in emails dated 22 March 2019 and after that date;
    3. the construction of the house was complete pursuant to the building contract by the end of November 2019 when Carlisle had undertaken all outstanding work listed in the DBDRV report. At that time, Mr Dawn should have taken possession of the property and made the final payment;
    4. Carlisle had subsequently incurred expense to "secure and maintain the property";
    5. although no specific monetary sums have been allocated to the items of work Mr Tabak says were carried out, I am satisfied that work of that general nature would be required if the builder were obliged to secure and maintain the property following a refusal by the owner to take possession and, accordingly, $500.00 per week was a genuine pre-estimate of the damages Carlisle was likely to incur if Mr Dawn failed to take possession when the building works were completed.
14. I take account of the obligation by Mr Dawn to be responsible in these circumstances for the insurance payments made by Carlisle. Although no specific claim has been made by Carlisle for the recovery of these costs under cl. 20.1 of the building contract, I consider that this expense would equally be recoverable under cl. 38.5, provided there was no duplication. The payment of the appropriate insurance premiums by Carlisle would appropriately be regarded as necessary to "secure and maintain the property" until possession was taken by Mr Dawn.
15. It is necessary to decide the period, in respect of which, Carlisle should recover "settlement damages". On one view, the starting date should be the date upon which Mr Dawn "failed to pay the Final Claim and take Possession as required under the Contract", which would be a date soon after 22 March 2019 when he was requested to make the final payment or provide the signed release for Enterprise Law to make the payment from the monies it held.
16. However, after 22 March 2019, Mr Dawn reverted to his position prior to the settlement meeting, claiming that the building works had not been properly completed. Further work was performed by Carlisle in response to the investigations by DBDRV and Mr Smith. This work was not completed until about December 2020. As I have previously discussed in these reasons, I am satisfied that, after Carlisle completed the outstanding work listed in the DBDRV report by the end of November 2019, Mr Dawn was required to pay the final claim and take possession.
17. The undertaking given by Carlisle to Senior Member Walker on 23 March 2021 effectively paused Carlisle's entitlement to claim settlement damages. The further periods of delay in the commencement of the hearing arose primarily from the epidemic. The exception was the short period from 8 August 2022 to 17 October 2022, which arose because of Mr Dawn's adjournment application.
18. In the circumstances, Carlisle is entitled to recover settlement damages for the periods:
    1. from 1 December 2019 to 23 March 2021, or 68 weeks at $500.00 per week, $34,000.00;
    2. from 8 August 2022 to 25 January 2023, or 24 weeks at $500.00 per week, $12,000.00;

1. It is unnecessary, therefore, to consider Carlisle's alternative claim for extensions of time and delay costs of $250.00 per week pursuant to cl. 34 of the building contract.
2. Is Mr Dawn entitled to liquidated damages of $250.00 per week or, alternatively, common law damages?

1. Mr Dawn claims liquidated damages of $250.00 per week as specified in Item 9 of cl. 1 of the building contract or, alternatively, common law damages as a consequence of the delayed "completion" of the contract works.
2. Clause 41 of the building contract is headed "Owner's claim for agreed damages" and reads as follows:

"41.0 If the Building Works have not reached Completion by the end of the Building Period the Owner is entitled to agreed damages in the sum set out in Item 9 of Schedule 1 for each week after the end of the Building Period to and including the earlier of:

• The date the Building Works reached Completion;
• The date this Contract is ended; and
• The date the Owner takes Possession of the Land or any part of the Land.

41.1 The Owner may deduct the amount of any such damages from the Final Payment".

1. Item 9 of Schedule 1 to the building contract specifies "$250.00" as the "Agreed damages for late completion of the Building Works".
2. In order to establish a claim under cl. 41, the owner must prove that "the Building Works have not reached completion by the end of the Building Period". In that event, the owner is entitled to $250.00 for each week "after the end of the Building Period to and including the earlier of" three possible dates; in this case, "the Date the Building Works reached Completion". The two other alternatives, the ending of the contract and Mr Dawn taking possession of the property, were never realised at any time before the conclusion of the hearing.
3. The principal issue in regard to the time "the Building Works reached completion" is the relevant date upon which Carlisle complied with the requirements of the building contract. The definition of "Completion" in cl. 1 of the building contract provided that it "means that the Building Works to be carried out under the Contract have been completed in accordance with the Plans and Specifications set out in the Contract and is the day on which the Builder provides the Owner with the Notice of Completion (as issued pursuant to Clause 36.0)".
4. The "time for completion" specified in cl. 1 of Schedule 1 and cl. 10 of the building contract was 252 days following the "actual day of commencement" of building work. Clause 1 of Schedule 1 provides that, "The building period is 252 days" and notes that, "the building period is the total of the days of actual building work and the estimates for delays". By cl. 10, "commencement must occur within 45 days after the builder receives" information from the owner, necessary permits and approvals and the payment of the deposit.
5. Carlisle, by letter dated 27 August 2018, notified Mr Dawn that "construction of your new home... commenced on 24/08/2018". Considering the building period of 252 days, completion was due on 3 May 2019.
6. Mr Dawn submitted, in relation to the date of the commencement of work, that Carlisle had never obtained all necessary permits and approvals as it had carried out rectification work involving the rebuilding of a boundary brick wall, the installation of a retaining wall and a garage door that required building permits that Carlisle never obtained. These matters were rectified by Carlisle before the end of November 2019.
7. In my view, whatever other consequences these matters might have, if established, they did not affect the "actual day of commencement", which was the date of 24 August 2018 stated in Carlisle's letter of 27 August 2018. Completion was therefore due 252 days later on 3 May 2019.
8. By email dated 21 January 2019, Carlisle sent Mr Dawn a Notice of Completion. On 22 March 2019, there was a failed "handover meeting". I have already discussed my reasons for concluding that shortly after this date, if Mr Dawn had intended to maintain his willingness to pay the final claim and take possession of the property, he should have forwarded the signed release to Carlisle or Enterprise Law to enable this to happen.
9. However, Mr Dawn apparently considered that, having proffered the signed release on 22 March 2019, this effectively met his obligation to pay the final claim without needing to maintain his willingness to do what was required to release the funds held by Enterprise Law. In fact, Mr Dawn, after 22 March 2019, adopted the position that he was no longer required to pay the final claim or take possession of the property until the building works were completed to his satisfaction.
10. Mr Dawn did not, either then or at any later time, purport to exercise any rights he may have had to bring the building contract to an end. If he had, that would likely have set the date, under cl. 41, when the entitlement to liquidated damages would finish. The building contract could only have been brought to an end by Mr Dawn if the Building Works had not reached Completion by the end of the Building Period, which would have meant that the date "the Contract ended" would be earlier than the date "the Building Works reached Completion".
11. If Mr Dawn believed that his obligation to pay the final claim had been satisfied, then he was mistaken. He should have continued to indicate his willingness to provide the signed release to Carlisle by Enterprise Law. Mr Dawn suggested during the hearing that he had a basis for believing that Carlisle had retained the original signed release after the conclusion of the "handover meeting" on 22 March 2019.
12. In my view, there is no basis for Mr Dawn to have this belief, for the following reasons:
    1. although Mr Dawn gave the original signed release to Ms Constantopoulos at the meeting on 22 March 2019, apparently so that it could be photocopied, it is likely that Ms Constantopoulos handed it back to Mr Dawn when the meeting was winding up;
    2. it seems clear that Mr Dawn took back the original signed copy and not simply a photocopy. It is likely that a black and white photocopy was taken and not a colour photocopy. The release he was to execute had been sent to him on 26 February 2019. In addition to his signature, Mr Dawn made handwritten additions to the document. It is likely that any photocopies would be very similar to the original;
    3. soon after, Carlisle had been told by Enterprise Law that the release, although marked "under protest", would be accepted;
    4. at no stage before the hearing did Mr Dawn indicate to Carlisle that it had in fact retained the original release document and had his authority to forward the document to Enterprise Law.
13. In any event, I consider that Carlisle was justified in adopting the position that it should not use the release document signed by Mr Dawn which it had in its possession after the settlement meeting, whether or not this document was the original or a photocopy. Mr Dawn had indicated that, after the document with the words (settled under protest) written on it had been rejected by Enterprise Law, he was not prepared to settle with Carlisle except upon his own terms.
14. In its email to Mr Dawn later on 22 March 2019, after the failed settlement meeting, Carlisle sought to clear with Mr Dawn whether he was prepared to allow Carlisle to use the signed release (notated "settled under protest"). Mr Dawn did not give his assent to this course. In the circumstances, it would not have been appropriate for Carlisle to unilaterally use the signed release, without Mr Dawn's express consent, to attempt to obtain the monies held in trust by Enterprise Law.
15. After Carlisle received Mr Dawn's email dated 27 March 2019 (on 16 April 2019), it was entitled to assume that Mr Dawn had altered his position following the failed settlement meeting and wished to assert that he would not take possession until the building works were complete. I have determined that "completion" occurred when the items listed in the DBDRV report were rectified by the end of November 2019.
16. In regard to Mr Dawn's claim for delay costs, I am satisfied that he has established his claim pursuant to cl. 42, for the period from 3 May 2019 to 30 November 2019, a period of 30 weeks.
17. In reaching this conclusion, I rely upon the following matters:
    1. the date for completion, as calculated under the building contract, was 3 May 2019;
    2. Mr Dawn was prepared to make the final payment and take possession of the dwelling on 22 March 2019, following his inspection of the property with Mr Durrant earlier that day and Mr Dawn's signing of the Certificate of Final Inspection;
    3. the handover meeting broke down when Enterprise Law indicated it would not accept a signed release marked "under protest";
    4. when Enterprise Law removed that objection, Carlisle requested Mr Dawn agree to allow it to use the copy of the release document it held, or for Mr Dawn to provide it with the signed copy of the release document;
    5. Mr Dawn failed to give his agreement or to provide the signed release or to otherwise pay the final claim;
    6. Mr Dawn raised further claims of defective or incomplete work in his email dated 27 March 2019;
    7. these further matters were included in the DBDRV report and were rectified by Carlisle by the end of November 2019;
    8. Mr Dawn has failed to establish that the further works identified by Mr Smith in August 2020 were necessary because of defective or incomplete work that was not contemplated by the processes in clauses 36 and 37 of the building contract, following Carlisle's notice of completion.
18. It is necessary to consider whether the delay damages should be capped at the figure for liquidated damages of $250.00 per week specified in the building contract or whether Mr Dawn is entitled to have delay damages assessed at large.
19. The legal principles which I must apply in this case are that Mr Dawn is limited to the agreed liquidated damages of $250.00 per week unless the agreed sum is too great, so as to be regarded as a "penalty" and not a genuine pre-estimate of loss, or too small, so as to be regarded as an inappropriate limitation on a party's entitlement to damages for breach.
20. It was not suggested by Carlisle that the sum of $250.00 was a penalty. In fact, it was Mr Dawn who submitted in his final written submissions that he would be penalised if he was limited to the sum of $250.00 and not permitted to claim damages.
21. In J-Corp Pty Ltd v Mladenis [2009] WASCA 157 ("J-Corp"), a decision of the Western Australian Court of Appeal, Newnes JA (with whom the other members of the Court of Appeal agreed) stated at [35] and [36], as follows:

"35 It is clear that the parties to an agreement may, as part of their agreement, fix an amount that is to be payable by way of damages in the event of a breach of the agreement. Provided the amount so fixed is a genuine pre-estimate of the damage that would arise from the breach, and not so out of all proportion as to be by way of a penalty, that amount is recoverable without proof of the actual loss caused by the breach. It is immaterial that the amount of the actual loss turns out to be less than the amount specified. Equally, if the actual loss turns out to be greater than the amount of the liquidated damages, the claimant cannot ignore the liquidated damages clause and sue for unliquidated damages: Diestal v Stevenson [1906] UKLawRpKQB 92; [1906] 2 KB 345; Talley v Wolsley-Neech (1978) 38 P & CR 45 (CA). That is, ordinarily a valid liquidated damages clause fixes the amount that is recoverable in the event of a breach, regardless of whether the claimant's actual loss is greater or less than the amount specified.

1. The position would appear to be the same where the amount specified is, not so disproportionately large as to be a penalty, but on the contrary so small that it cannot be regarded as a genuine pre-estimate of the probable loss. In such a case, the clause has been regarded as akin to a clause limiting the extent in damages of a party's liability: McGregor on Damages (17th ed, 2003) 13-071".
2. In Hacer Group Pty Ltd v Euro Façade Tech Export Sdn Bhd [2022] VSC 373 ("Hacer"), Stynes J followed the decision in J-Corp, stating at [179]-[182], as follows (with footnote references omitted):

"179 If the actual loss turns out to be greater than the amount of liquidated damages, the claimant cannot ignore the liquidated damages clause and sue for unliquidated damages. That is, ordinarily, a valid liquidated damages clause fixes the amount that is recoverable in the event of a breach, regardless of whether the claimant's actual loss is greater or less than the amount specified.

1. In my view, two factors in combination weigh heavily in favour of finding that a liquidated damages clause provides an exhaustive remedy for delay:

(a) if a positive sum of liquidated damages has been stipulated under the contract. In this case, Schedule E of the Subcontract sets out a positive sum for liquidated damages in relation to each milestone date of $9,500 per day capped at 5% of the contract price; and > > (b) if the liquidated damages clause is mandatory.

2. In my view, clause 29 of the Subcontract is mandatory. The language used does not evince an intention of the parties to confer a discretion to opt for common law damages over the liquidated damages provided for in the Subcontract.
3. Consequently, I consider that the mandatory language in clause 29, in conjunction with the positive sum specified for liquidated damages, indicates that the parties intended to be bound exclusively by the liquidated damages regime. Accordingly, I find that Hacer's entitlement to damages for delay is limited to the recovery of liquidated damages under clause 29".
4. In my view, Stynes J was not intending to derogate from the judgment in J-Corp by referring to a relevant factor in her consideration being, "if the liquidated damages clause is mandatory". In each case, the Court or Tribunal must construe the relevant clause or clauses of the contract. In many of the reported cases, where this issue has been decided, the amount of liquidated damages has been specified as "nil" or "n/a" [not applicable] or left blank (either with or without some indication on the printed form as to what the default position might be). In these circumstances, a determination must be made as to the effect of the contract provision and whether all damages are excluded.
5. In the present case, the amount of $250.00 per week was specified as the amount of liquidated damages. In the circumstances, Mr Dawn is not required to prove his actual loss and is limited to recovering no more than that sum.
6. If Mr Dawn were permitted to prove his actual loss, there would have been other matters to consider:

1. Mr Dawn's claim was based on "loss of rental"; 2. Mr Dawn stated in his evidence [T298-299]: * I have a number of rental properties. * I have little to no interest in having a five bedroom home with three living areas in Clyde North as a rental property. * It will have a massive family in it. It ... will be the biggest millstone I own. * Between five fifty and six fifty a week ... rental is a reasonable expectation for the average Joe. * [In response to the question, "You had no intention of renting it?] - I have no, I don't want to rent it.

1. In paragraph 9 of orders made by the Tribunal on 20 October 2022, Mr Dawn was given leave to file expert evidence in support of his damages claim based on loss of rental. It is arguable whether the material sought to be relied on by Mr Dawn complies with this order and whether it would be appropriate to permit its use.
2. Accordingly, Mr Dawn is entitled to liquidated damages of $250.00 per week from 3 May 2019 until 30 November 2019 (a total of 30 weeks); total damages $7,500.00.

Calculation of amounts owing by and to the parties

1. The amounts owing to the parties are as follows:

1. The liquidated damages to which Mr Dawn is entitled must be deducted from the final payment pursuant to cl. 41.1. The balance, with the maintenance costs, owing to Carlisle is $79,279.40.

1. Carlisle has claimed interest on the amounts to which it is entitled at the rate of 13.9% per annum pursuant to cl. 31.0 and Item 8 of Schedule 1 of the building contract. Interest would be limited to the period from 7 December 2019 (allowing 7 days after the completion of all defective and incomplete work by the end of November 2019) until the date of judgment on 16 June 2023, excluding the period from 23 March 2021 to 8 August 2022.
2. Carlisle's interest is calculated as follows:

1. Pursuant to the arrangement by which Mr Dawn was required to lodge the sum of $40,779.40 with Enterprise Law, he was entitled to be paid the interest accruing on that sum until it was paid to Carlisle. Accordingly, that sum must be taken into account by deducting it from the sum otherwise payable by Mr Dawn to Carlisle.

1. The sum owing by Mr Dawn to Carlisle is $102,949.33, calculated as follows:

1. In the circumstances, the following orders are appropriate:
   1. Leave to the Respondent to file and serve Further Amended Points of Defence and Further Amended Points of Counterclaim in accordance with the documents each dated 17 October 2022 and filed on 19 October 2022.
   2. Leave to the Applicant to file and serve Further Amended Points of Claim and Amended Reply and Defence to Further Points of Counterclaim both dated 22 November 2022.
   3. Judgment for the Applicant against the Respondent that the Respondent pay to the Applicant the sum of $102,949.33.
   4. The Respondent's counterclaim is dismissed.
   5. All interest accrued on the sum of $40,779.40 held on trust for the parties by Enterprise Law since 24 July 2018 must be paid to the Applicant in reduction of the judgment sum.
   6. By 4.00pm on 23 June 2023, the parties must file and serve written submissions on the following matters:
      1. the question of the costs of the proceeding;
      2. whether the party wishes to make further oral submissions and, if so, the reasons for requesting a further hearing.
2. Upon receipt of the parties' written submissions, further orders will be made by the Tribunal.