Champion Homes Sales Pty Ltd v Voulgaris [2025] NSWSC 1488 | Case summary

Medium Neutral Citation: Champion Homes Sales Pty Ltd v Voulgaris [2025] NSWSC 1488

Hearing dates: 9 July 2025

Date of orders: 12 December 2025

Decision date: 12 December 2025

Jurisdiction: Common Law

Before: Walton J

Decision: (1) Leave to bring Ground 5 of the appeal is refused.
(2) The appeal is otherwise dismissed.
(3) In so far as judicial review was sought, the application is dismissed.
(4) Champion Homes Sales Pty Ltd shall pay the costs of the appeal of Evonne Voulgaris as agreed or in default as assessed.

Catchwords: APPEAL – Application for leave to appeal from the decision of an Appeal Panel of the New South Wales Civil and Administrative Tribunal – Civil and Administrative Tribunal Act 2013 (NSW), s 83 – Appeal on a question of law – Principles governing grant of leave to appeal – Discrete treatment of contractual and statutory issues – No appeal as to question of contract
APPEAL – Question of law – Construction of building contract – Whether the Appeal Panel’s construction of the contract was erroneous – Whether the contract provisions preclude the builder’s claim because the builder failed to take out warranty insurance – Principles of construction of commercial contracts – Notations
APPEAL – Question of law – Whether the Appeal Panel erred in holding that the builder’s claim was part of the contract price – Builder not entitled to any payment from the owner except for the contract price
APPEAL – Whether Appeal Panel erred in definition of “residential building work” – Home Building Act 1989 (NSW) – Operation of ss 10, 92 and 94 – Whether work of a preparatory nature constitutes “residential building work” – Effect of failure to obtain warranty insurance – Statutory bar on recovery – Relationship between Home Building Act 1989 (NSW) and contractual rights
APPEAL – Relief – Failure to appeal Tribunal Decision on contract – Failure to bring effective appeal to Appeal Panel on contract or in Supreme Court appeal – Leave refused on contract ground – Appeal otherwise dismissed

Legislation Cited: Civil and Administrative Tribunal Act 2013 (NSW), ss 80, 83
Home Building Act 1989 (NSW), ss 10, 48A, 92, 94, 103B(1)
Supreme Court Act 1970 (NSW), s 69

Cases Cited: AMEV-UDC Finance v Austin (1986) 162 CLR 170; [1986] HCA 63
Boucaut Bay Co Ltd v The Commonwealth (1927) 40 CLR 98
Byrne v Australian Airlines Ltd (1995) 185 CLR 410; [1995] HCA 24
Champion Home Sales Pty Ltd v Voulgaris [2024] NSWCATAP 244
Champion Homes Sales Pty Ltd v Biggs; Biggs v Champion Homes Sales Pty Ltd [2023] NSWCATCD 117
Chapmans Ltd v Australian Stock Exchange Ltd (1996) 67 FCR 402; [1996] FCA 474
Cirrus Real Time Processing Systems Pty Ltd v Jet Aviation Australia Pty Ltd (2023) 113 NSWLR 80; [2023] NSWCA 280
Collings Homes v Head & Ors [2002] NSWSC 1219
Field v Dettman [2013] NSWCA 147
Gan v Shop 3, 228-230 Hanvaylee Parade Kensington Pty Ltd [2017] NSWSC 1322
George v Cluning (1979) 28 ALR 57
Grygiel v Baine & Ors [2005] NSWCA 218
Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896
Lam v Liu [2025] NSWCA 254
Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (No 2) [2025] NSWCA 210
Lawrence v Ciantar [2020] NSWCA 89
Lawrence v Ciantar; Cianter v Lawrence [2019] NSWSC 464
Lewis Construction (Engineering) Pty Ltd v Southern Electric Authority of Queensland (1976) 38 LGRA 242; (1976) 11 ALR 305
Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181; [2001] HCA 70
Price v Spoor (2021) 270 CLR 450; [2021] HCA 20
Provincial Homes v Doyle & Ors [2004] NSWSC 624
Syed Ahmad Shoaib Ali Pty Ltd v Jandson Pty Ltd; Jandson Pty Ltd v Syed Ahmad Shoaib Ali Pty Ltd [2018] NSWCATAP 228
Tin-Tagel Majikk Pty Limited v Hockey [2025] NSWSC 578
Woolfe v Alexander Sussman t/as Sussman Construction Consulting Services & Anor [2001] NSWSC 702

Texts Cited: Shorter Oxford English Dictionary, 6th ed (2007)

Category: Principal judgment

Parties: Champion Homes Sales Pty Ltd (Plaintiff)
Evonne Voulgaris (Defendant)

Representation: Counsel:
C Stomo (Plaintiff)
M Bennett (Defendant)
Solicitors:
Kedron Legal (Plaintiff)
Uther Webster & Evans Solicitors (Defendant)

File Number(s): 2024/477247

Publication restriction: Nil

JUDGMENT

By a Summons filed on 23 December 2024, Champion Homes Sales Pty Ltd (“the builder”) sought to appeal (“the appeal”), pursuant to s 83 of the Civil and Administrative Tribunal Act 2013 (NSW) (“NCAT Act”), a decision of the New South Wales Civil and Administrative Tribunal (“NCAT”) Appeal Panel made on 29 November 2024: Champion Home Sales Pty Ltd v Voulgaris [2024] NSWCATAP 244 (per D G Charles, Senior Member, and P H Molony, Senior Member) (“the Appeal Panel Decision”).
The Appeal Panel Decision concerned a decision by Senior member R C Titterton OAM (“the Tribunal”) dated 29 July 2024: Champion Homes Sales Pty Ltd v Voulgaris (NSWCATCD, R Titterton OAM, Senior Member, 29 July 2024, unrep) (“the Tribunal Decision”).
The proceedings before the Tribunal concerned an application that was brought by the builder against Evonne Voulgaris ("the owner"), for damages claimed under a building contract dated 23 June 2022, for the construction of a new two-storey residential dwelling (“the contract”) on the owner’s property at 5 King Street Eastlakes, NSW ("the site") (“the builder’s claim”).
The Tribunal concluded that the builder’s claim was precluded by both the terms of the contract and the provisions of s 92(2) of the Home Building Act 1989 NSW ("the HB Act").
The Appeal Panel confirmed the Tribunal Decision as to the operation of the HB Act, and accordingly, dismissed the appeal. However, the Appeal Panel also made observations as to the correctness of the Tribunal Decision with respect to the operation of the contract. That approach conformed with the position that the builder brought no ground of appeal to the Appeal Panel expressly challenging the Tribunal Decision as to the contract barring the builder’s claim because of the absence of insurance.
In this appeal, the builder relied upon eight grounds of appeal, six of which challenged the Appeal Panel Decision as to the operation of the HB Act. Only one ground, Ground 5, concerned the contract. However, Ground 5 was expressed in terms which did not engage directly with the Tribunal Decision or Appeal Panel Decision going to the operation of the contract itself in excluding the builder’s claim.
In describing the type of appeal, the Summons stated as follows:

“Application for Leave to Appeal, per section 83 of the Civil & Administrative Tribunal Act 2013 (NSW) (NCATA) and Application for Judicial Review, per Section 69 of the Supreme Court Act 1972 (NSW).” (emphasis added)

That was the first and last occasion in these proceedings that any reference was made to relief in the form of judicial review. No submissions were developed in support of that relief, nor was there any challenge made by way of judicial review to the Tribunal Decision per se. To the extent that it has any relevance to the present proceedings, this aspect of the Summons must be seen to be coextensive with the appeal under s 83 of the NCAT Act itself.
The relief sought by the builder pursuant to the Summons was, inter alia, as follows:

“3 Judgment of 29 November 2024 (AP) of the Appeal Panel, being the court below, be set aside.

4 That appeals of the plaintiff, Champion Home Sales Pty Ltd (Builder) from the orders of the Tribunal for case no HB 2023/00382187 in its Substantive Decision made on 29 July 2024 and the Costs Decision made on 18 September 2024, are upheld, and those decisions be set aside.”

Accordingly, the relief sought, in that respect, corresponds to the actual appeal brought by the builder from the Tribunal Decision, with the limitations I have discussed above. The relief sought, that the Tribunal Decision and the Appeal Panel Decision be set aside, are predicated on that approach.

FACTUAL BACKGROUND

There was no dispute as to the material facts as set out by the Appeal Panel, the Evidentiary Statement of Steve Malesev dated 25 October 2023 (“the Malesev Evidentiary Statement”) and the builder’s written submissions dated 20 May 2025. They were, in summary, as follows:
The builder carried on business as a residential builder and was predominant engaged in the construction of houses and duplexes within the Greater Sydney area.
The owner was the registered proprietor of a property at 5 King Street Eastlakes.
The contract price was for an amount of $530,000 (“the contract price”), with a $15,000 tender fee that had previously been paid to the owner on 4 May 2022, to be credited towards the contract price in the event that a contract was entered into.
The owner was required to establish that she had sufficient funds to pay the contract price, including written advice to the builder of the finance she had obtained from a lending body, pursuant to cl 4.1(d) of the contract.
Under cl 7.1 of the contract, the owner was required, when requested by the builder at any time, to deposit part of the contract price not being supplied by a lending body into an account of a bank, building society, or similarly recognised financial institution (this was referred to as a “security account”). The security account was held in the joint names of the builder and the owner.
The builder commenced work on obtaining development approval shortly after 23 June 2022. To that end, the builder arranged for a contour survey of the site dated 31 August 2022, and had also previously obtained a site and wind classification report dated 23 May 2022.
On receipt of the contour survey, the builder's architectural drafting team commenced working on the architectural plans.
On 7 September 2022, the builder lodged the development application (“DA”), together with the architectural plans and supporting documentation, with the Bayside Council through the NSW planning portal.
On 7 October 2022, the builder received a letter from the Bayside Council requesting additional information and amendments to the plans.
On 27 October 2022, the builder submitted amended plans and supporting documentation to the Bayside Council.
On 29 November 2022, the Bayside Council issued development consent to the builder for the demolition of the existing structures on the site, and the construction of a two-storey dwelling.
On 6 December 2022, the builder sent a copy of the development consent for the DA and associated plans to the owner.
As part of the DA process, the builder arranged for a permeability assessment (dated 23 February 2023) to be carried out on the site, because a condition of the development consent for the DA required the builder to engage a geotechnical engineer to determine the infiltration/absorption rate of the site prior to the final design of the drainage system for the proposed development.

(a) arranged for a pre-dilapidation report on 9 March 2023 for the public domain around the site; (b) obtained a geotechnical report; and (c) undertook a sewer peg out of the site.

At [54] of the Malesev Evidentiary Statement, Mr Malesev sets out, in summary form, the content of the work undertaken by the builder in connection with the obtaining of the DA together with the fees and charges for those works. I extract [54] from the Malesev evidentiary statement below:

“[54] Champion Homes has incurred the following fees and charges:

Geotechnical report $1,375.00

Dilapidation report $495.00

Contour survey (incl extra detail) $1,897.50

Bayside Council - DA application & related fees $4,263.96

Donovans - engineering detail $957.00

Donovans - soil test & windspeed report $335.50

Sewer peg out $550.00

$9,874.63”

The entirety of the work undertaken by the builder in connection with the DA, as summarised in the extract above, shall be referred to as “the building works” in this judgment.

I pause to note that there was a dispute as to one aspect of the building works concerning “sewer peg out”. That is the last item referred to in the list of building works referred to in the immediately preceding paragraph. The same entry appears in the builder’s Points of Claim filed with NCAT.
There was a dispute in the submissions of the parties as to whether a sewer peg out actually required the pegging out of the site. Mr C Stomo of counsel for the builder suggested that the sewer peg out did not involve “any physical activity on site” and merely involved getting “the plans from Sydney Water so you know where the sewers are”. Mr M Bennett of counsel for the owner suggested that the work involved actual pegging out on the site.
The work of obtaining a sewer peg out arose directly as a requirement by the Bayside Council in consequence of the DA seeking the Council’s consent for the “Demolition of the structures, tree removal and construction of a two (2) storey building on the above premises”. Having considered the DA, the Bayside Council identified a number of issues, one of which concerned Sydney Water assets. That issue was stated in the following terms:

“There are existing Sydney Water assets located in proximity to the proposed absorption trench at the rear of the allotment. To ensure the assets will not be impacted by the proposal at this stage, an updated survey plan or Service Protection Report (Sewer peg-out) is required to be obtained.”

In support of his contention that the sewer peg out did not involve any physical activity on site, Mr Stomo referred to [53] of the Malesev Evidentiary Statement. In that paragraph, Mr Malesev referred to the sewer peg out survey providing “information as to the location of any existing Sydney Water Asset within or adjacent to the proposed development”. Mr Malesev attached a document in Exhibit SM-1 which was in the form of a survey report bearing the heading “Service Protection Report”.
It is unclear from Mr Malesev’s evidence whether the survey diagram was obtained from drawings held by the Bayside Council, or from pegs situated on the site by a surveyor, or both. I will proceed on the basis that the sewer peg out was as suggested by Mr Stomo, given the appearance of the drawing in Exhibit SM-I, without suggesting that this view necessarily conforms with the ordinary understanding of a sewer peg out.
Nonetheless, the investigations in relation to the sewer peg out, together with other aspects of the building works, had significant implications for the building project as contemplated by the contract.

Notice of breach

On 10 May 2023, the builder issued a “Notice of Breach” to the owner regarding an alleged failure by the owner to provide evidence of her ability to pay for the cost of the building works (in accordance with cl 4 of the contract), despite the builder’s requests
On 17 May 2023, the owner sent, by email, a screen shot of a bank account showing an amount of $539,404.27 in funds said to be available for the construction of the dwelling on the site.
On 19 May 2023, the builder requested that a security account be established in the joint names of the builder and the owner pursuant to cl 7.1 of the contract. That step was not undertaken.
The parties exchanged emails, some marked “Without Prejudice”. On 29 May 2023, the builder issued a further “Notice of Breach” and a “Notice to Perform Contract” to the owner.
On 2 June 2023, the owner’s solicitors sent correspondence marked “Without Prejudice” to the builder, with further correspondence on a without prejudice basis in relation to various matters now in dispute between the parties.
The builder terminated the contract on 25 July 2023 pursuant to cl 27 of the contract.
While the builder, by its employees and/or contractors, was present on the site for the building works, no physical building works were undertaken prior to the end of the contract.
The contract contained a cl 44.15, which entitled the builder to damages in an agreed sum equivalent to 15% of the contract price, which the parties acknowledged to be a genuine pre-estimate of the builder’s loss or damage.
Following termination of the contract, the builder sought payment of 15% of the contract price pursuant to cl 44.15, although, the amount claimed before the Tribunal was adjusted by reference to a reimbursement of fees and charges and a credit for the tender fee paid by the owner. I will discuss that claim in the context of discussing the Tribunal proceedings and decision.
The owner did not pay this amount, and the builder lodged an application in NCAT to recover those monies on 2 August 2023.

ISSUES ON THIS APPEAL

A primary issue in this appeal was the construction of ss 10, 92, 94 of the HB Act, and, in particular, the definition of “residential building work” in cl 2 of Sch 1 of the HB Act. The builder sought to challenge the Appeal Panel’s definition of “residential building work” which adopted an expanded definition of “residential building work” so as to include preparatory work as per Syed Ahmad Shoaib Ali Pty Ltd v Jandson Pty Ltd*;* Jandson Pty Ltd v Syed Ahmad Shoaib Ali Pty Ltd [2018] NSWCATAP 228 (“Sye**d”). The owner resisted the builder’s contentions in this respect.
Notwithstanding that approach, the operation of the terms of the contract was central to the determination of this appeal. In fact, the owner contended that the provisions of the contract were fatal to the appeal. The owner contended that the builder may not raise issues as to the construction of the contract on this appeal, as no challenge was made to the Tribunal’s findings in that respect before the Appeal Panel. I have earlier expressed a view as to the limits of the builder’s appeal, in that respect.
How that issue emerges in the appeal is best understood after the discussion of the Tribunal Decision and Appeal Panel Decision. The examination of those decisions will be assisted by a closer examination of the contract and relevant statutory provisions.

The contract and the HB Act

In the light of those issues, I set out the relevant provisions of the contract and the HB Act below.

The Contract

The construction of the contract was contentious.
The contract appeared at page 43 of Volume 2 of the Joint Court Book and consisted of 7 Schedules, “Signatures”, “General Conditions”, “Special Conditions”, and a “Deed of guarantee and Indemnity”. The Court Book also contained a “Checklist” and a “Consumer Building Guide” which were annexed, respectively, as Attachment A and B of the contract, but not forming part of the contract.
The Tribunal Decision provided a useful overview of the contract, as follows:

“[17] The contract relevantly provided that:

(1) The Contract price was $530,000;

(2) Mrs Voulgaris must pay the Contract price and other moneys that becomes payable under this Contract in the manner and at the times stated in this Contract: cl 3.1 (“Owners Obligations”);

(3) Mrs Voulgaris must, within the initial period, if she is obtaining finance from a lending body, give Champion Homes written advice from the lending body the amount of finance, when added to the owner's own available funds, is sufficient to pay the Contract price: cl 4.1(d) (“Essential Matters”);

(4) Mrs Voulgaris must, when requested by Champion Homes at any time, deposit that part of the Contract price not being supplied by a lending body into an account at a bank, building society or a similarly recognised financial institution to be known as a security account. The security account must be in the joint names of Mrs Voulgaris and Champion Homes, with Mrs Voulgaris receiving interest, if any, on the money deposited in the account and the builder as a joint signatory for any withdrawal from the account: cl 7.1 (“Security Deposit and Ability to Pay”);

(5) if Champion Homes ends this contract under cll 14, 26, 27 or 28, then at the election of Champion Homes, Mrs Voulgaris must pay as a debt due and payable either:

(a) the greater of the cost of or the market value of the building works to date including the cost of any materials on the site or already ordered from suppliers and the cost of quitting the site less the amount already paid by the Mrs Voulgaris; or

(b) damages in the sum equivalent to 15% of the contract price which the parties acknowledge to be a genuine pre-estimate of the Champion Homes’ loss or damage: cl 29 (“Effect of the Builder Ending the Contract”);

(6) if, prior to the physical commencement of works on site, Mrs Voulgaris wrongfully ends the Contract she must pay Champion Homes damages in the sum equivalent of 15% of the Contract price, which the parties acknowledged to be a genuine re-estimate of Champion Homes; loss or damage: cl 44.15 (“Owner Acknowledgments and Agreements”);

(7) to the extent required by the Act, Champion Homes warrants that the building works will be done in accordance with, and will comply with, the Act or any other law: cl 39 (“Statutory Warranties”);

[18] Also, appearing in Schedule 1 (“Particulars of Contract”) to the Contract are various provisions relied on by Mrs Voulgaris. These are (emphasis added by the Tribunal):

2. (a) Contract price (Clause 1)

The contract price is: Five hundred and thirty thousand dollars only

…

Note: The builder cannot demand or receive any of the contract price (including the deposit) until warranty insurance is in force and the owner is provided with the certificate of insurance.

…

10. Development application and complying development certificate (Clause 5)

The party to obtain and pay for all planning and building approvals including; engineering and survey fees is; The Builder as the agent for the Owner.

(emphasis added)

[19] Further, also appearing in Schedule 6 (“Warranty Insurance”) the Contract states:

NOTE: The builder must not carry out any building work or demand or receive any part of the contract price until warranty insurance is in force and the owner is provided with the certificate of insurance.

[20] And on p 11 of the Contract, headed “Signatures” the following appears:

This contract is made between the owner and the builder.

The Schedules form part of the Contract.

…

NOTE: The builder must not demand or receive any part of the contract price until warranty insurance is in force and the owner is provided with the certificate of insurance.

(emphasis added)

[21] Finally, Attachments A and B of the Contract relevantly provide:

Attachment A: Checklist

...

13. Do you understand that you are not required to pay the contract a deposit or any progress payments until the contractor has given you a certificate of insurance under Part 6 or Part 6B of the Home Building Act 1989 (except where the work is of a kind that does not require insurance)?

…

Attachment B: Consumer Building Guide

The builder or tradesperson must give you evidence of HBC cover before they start work on your project or you pay them any money, including a deposit.”

The owner also made reference to the following provisions of the contract:

“Clause 1. Interpretation …

…

'building works' means the building works to be carried out, completed and handed over to the owner in accordance with this contract as shown in the contract documents and includes variations.

…

'contract' means the agreement between the builder and the owner set out in the contract documents;

'contract documents' means these general conditions, any special conditions, the plans, the specifications and other documents specified in Schedule 5;

…

‘warranty insurance’ means insurance under the Home Building Compensation Fund as referred to in the Home Building Act;

…

Clause 38. Insurances

38.1 The builder must insure against:

(a) loss or damage to the building works and any goods and materials on the site relating to the building works against theft, fire, explosion, lightning, hail, storm and tempest, vandalism, civil commotion and earthquake; and

(b) public liability for an amount of $10,000,000 for any one claim.”

As I will discuss later in this judgment, the contract contains (in various places), a narrative that the builder cannot “demand or receive any of the contract price until warranty insurance [1] is in force and the owner is provided with a certificate of insurance”. Each of those entries was preceded by the word “Note”. Those notations were found at cl 2(a) of Sch 1, Sch 6, immediately below the signature of the builder (in the Signature section of the contract). The Schedules formed part of the contract. I will refer to those each of those notes as the “Notation” or “Notations”.
The builder contended that these terms did not form part of the contract, or have any legal effect.
Clause 38.2 of the contract was as follows:

“[38.2] The above insurance policies must be in place before the builder commences the building works and must be maintained:

(a) in the cause of the building works policy, to and including the date of practical completion; and

(b) in the case of public liability policy, for the duration of the contract.”

Clause 38.2 formed part of the General Conditions of the contract and, therefore, does not warrant the description of a Notation. As I will discuss later, it should be read in conjunction with cl 3.1 and 38.1 of the contract, in order to properly understand it’s operation.
Item 13 of Attachments A and Attachment B, which both also contained the Notation, do not form part of the contract, but may, as I will discuss, assist in understanding the intention of the authors of the contract.

Relevant Provisions under the HB Act

Given the various grounds of appeal raised in the Summons involve the interpretation and application of the HB Act, it is pertinent to set out the relevant positions of that Act:

10 Enforceability of contracts and other rights

(1) A person who contracts to do any residential building work, or any specialist work, and who so contracts--

(a) in contravention of section 4 (Unlicensed contracting), or

(b) under a contract to which the requirements of section 7 apply that is not in writing or that does not have sufficient description of the work to which it relates(not being a contract entered into in the circumstances described in section6(2)), or(c) in contravention of any other provision of this Act or the regulations that is prescribed for the purposes of this paragraph,

is not entitled to damages or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract, and the contract is unenforceable by the person who contracted to do the work. However, the person is liable for damages and subject to any other remedy in respect of a breach of the contract committed by the person.

(2), (3) (Repealed)

(4) This section does not affect the liability of the person for an offence against

a provision of or made under this or any other Act.

…

92 Contract work must be insured

(1) A person must not do residential building work under a contract unless--

(a) a contract of insurance that complies with this Act is in force in relation to that work in the name under which the person contracted to do the work, and

(b) a certificate of insurance evidencing the contract of insurance, in a form approved by the Authority, has been provided to the other party (or one of the other parties) to the contract.

: Maximum penalty--1,000 penalty units in the case of a corporation and 200 penalty units in any other case.

Note--: Part 6B (see section 104B) provides that the requirement to obtain insurance under this section may be met by obtaining coverage through an alternative indemnity product.

(2) A person must not demand or receive a payment under a contract for residential building work (whether as a deposit or other payment and whether or not work under the contract has commenced) from any other party to the contract unless--

(a) a contract of insurance that complies with this Act is in force in relation to that work in the name under which the person contracted to do the work, and

(b) a certificate of insurance evidencing the contract of insurance, in a form approved by the Authority, has been provided to the other party (or one of the other parties) to the contract.

Maximum penalty—1,000 penalty units in the case of a corporation and 200 penalty units in any other case.

(2A) An individual who is convicted of a second or subsequent offence under subsection (1) or (2) is liable to a penalty not exceeding 500 penalty units or imprisonment for a term not exceeding 12 months, or both.

(3) This section does not apply if the contract price does not exceed the amount prescribed by the regulations for the purposes of this section or (if the contract price is not known) the reasonable market cost of the labour and materials involved does not exceed that amount.

(4) If the same parties enter into two or more contracts to carry out work in stages, the contract price for the purposes of subsection (3) is taken to be the sum of the contract prices under each of the contracts.

(5) A contract of insurance that is in force in compliance with this section in relation to residential building work (the original work) done by a person extends to any residential building work done by the person by way of rectification of the original work.

Note—

Accordingly, this section does not require a separate contract of insurance in relation to the rectification work.

(6) To avoid doubt, this section extends to residential building work that is also owner-builder work (when the work is done under a contract between the person who contracts to do the work and the owner-builder).

…

94 Effect of failure to insure residential building work

(1) If a contract of insurance required by section 92 is not in force, in the name of the person who contracted to do the work, in relation to any residential building work done under a contract (the "uninsured work" ), the contractor who did the work--

(a) is not entitled to damages, or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract, in relation to that work, and

(b) is not entitled to recover money in respect of that work under any other right of action (including a quantum meruit).

(1A) Despite section 92(2) and subsection (1), if a court or tribunal considers it just and equitable, the contractor, despite the absence of the required contract of insurance, is entitled to recover money in respect of that work on a quantum meruit basis.

(1B) A contractor who applies to a court or tribunal for a remedy under this section, or who is awarded money under this section, is not guilty of an offence under section 92(2) by virtue only of that fact.

(1C) Without limiting the factors that a court or tribunal may consider in deciding what is just and equitable under subsection (1A)—

(a) in relation to any contract—the court or tribunal may have regard to the impact on the resale price of the property if no contract of insurance is provided,

and

(b) in relation only to a contract entered into before 30 July 1999—the court or tribunal is not to be limited by the fact that the required contract of insurance was not obtained until after the date of the contract.

(2) However, the contractor remains liable for damages and subject to any other remedy in respect of any breach of the contract committed by the contractor.

(3) Residential building work that is uninsured work at the time the work is done ceases to be uninsured work for the purposes of this section if the required contract of insurance for the work is subsequently obtained.

(4) If a person commenced residential building work before 30 July 1999 and entered into a contract of insurance that complies with this Act in relation to that work after the contract for the residential building work was entered into, that contract of insurance is, for the purposes of this section or any previous version of this section, taken to have been in force in relation to the residential building work done under the contract for the residential building work whether that work was done before or after the contract of insurance was entered into.

Note—

If a contract of insurance is in force in relation to part of the residential building work, this section applies only in relation to the part of the work that is not insured.

RELEVANT PRINCIPLES REGARDING THE APPEAL

Principles regarding Leave under s 83 of the NCAT Act

The appeal brought by the builder is an appeal on a question of law pursuant to s 83 of the NCAT Act*,* and therefore, requires the grant of leave by the Supreme Court.
Section 83 of the NCAT Act is as follows:

83 Appeals against appealable decisions

(1) A party to an external or internal appeal may, with the leave of the Supreme Court, appeal on a question of law to the Court against any decision made by the Tribunal in the proceedings.

(2) A person on whom a civil penalty has been imposed by the Tribunal in proceedings in exercise of its enforcement or general jurisdiction may appeal to the appropriate appeal court for the appeal on a question of law against any decision made by the Tribunal in the proceedings.

(3) The court hearing the appeal may make such orders as it considers appropriate in light of its decision on the appeal, including (but not limited to) the following--

(a) an order affirming, varying or setting aside the decision of the Tribunal,

(b) an order remitting the case to be heard and decided again by the Tribunal (either with or without the hearing of further evidence) in accordance with the directions of the court.

(4) Without limiting subsection (3), the appropriate appeal court for an appeal against a civil penalty may substitute its own decision for the decision of the Tribunal that is under appeal.

There are many cases which deal with the principles governing leave to appeal under s 83 of the NCAT Act. The following extract from Gan v Shop 3, 228-230 Hanvaylee Parade Kensington Pty Ltd [2017] NSWSC 1322 at [27]-[37] (per Walton J) provides a relevant summary of those principles:

“[27] The appeal brought by the plaintiff thereby requires the grant of leave and is an appeal “on a question of law”: Davis v NSW Land and Housing Corporation [2016] NSWCA 325 (“Davis”) at [44] (per McColl JA, with whom Meagher and Leeming JJA agreed) and Allen v TriCare (Hastings) Pty Ltd [2015] NSWSC 416 at [57] (per Beech-Jones J).

[28] The following observations by McColl JA in Davis (at [77]-[79]) identify the parameters application to an appeal on a “question of law” as follows:

[77] First, on such appeal, the existence of a question of law is not merely a qualifying condition to the right of appeal, but the question of law alone is the subject matter of the appeal. The Supreme Court cannot engage in a “review of the merits” of the decision.

[78] Secondly, such an appeal is in the nature of a judicial review in which it is necessary to examine for legal error what has been done in the Appeal Panel. That will almost inevitably require consideration of the Tribunal’s findings to determine whether the Appeal Panel’s conclusion on the question of law identified in respect of the Tribunal’s reasons was open.

[79] Thirdly, on such an appeal, in certain circumstances, a new issue, not raised before the Tribunal, may be raised. In considering whether to permit that course in the exercise of the court’s discretion, the court will take into account Coulton v Holcombe considerations. It will also take into account considerations specific to the limited nature of an appeal from the Tribunal on a question of law, for example that referred to by Gummow J in Federal Commissioner of Taxation v Raptis, “that there is difficulty in finding an ‘error of law’ in the failure in the Tribunal to make a finding first urged in this Court.”

[Footnotes omitted.]

[29] As to the third proposition by her Honour the following observations of Basten JA in Bronze Wing International at [11] may be mentioned:

[11] It would be a rare case in which the Supreme Court would grant leave to appeal on a question of law which had not been raised before the Appeal Panel and which, accordingly, had not been the subject of “any decision made by [the Appeal Panel] in the proceedings.” No such ground for leave was invoked in the present case. Accordingly, the grounds available before the primary judge in the Common Law Division were limited to matters of law which had been raised before the Appeal Panel.

[30] As mentioned above, an appeal to this Court under s 83(1) of the CAT Act can only be brought with leave of the Court. I agree with the observations of the Hamill J in The Owners - Strata Plan No 73943 v Gazebo Penthouse Pty Ltd [2014] NSWSC 1536 at [18] that the determination of leave should be the first matter considered by the Court in proceedings of that character and that the statements of principle enunciated by Basten JA (with whom Tobias AJA agreed) in Be Financial Pty Ltd as Trustee for Be Financial Operations Trust v Das [2012] NSWCA 164 (“Be Financial”) at [32]-[36] should be applied to applications for leave under s 83(1) of the CAT Act.

[31] Those passages from Be Financial, together with [37] of that judgment, are as follows:

[32] The principles governing cases such as these have recently been restated in Zelden v Sewell; Henamast Pty Ltd v Sewell [2011] NSWCA 56. As Campbell JA noted (with the agreement of Young JA) at [22]:

"It is of some importance to reiterate the principles that were stated in Carolan v AMF Bowling Pty Limited [1995] NSWCA 69, where Sheller JA said that an applicant for leave must demonstrate something more than that the trial judge was arguably wrong in the conclusion arrived at. Cole JA relied on a principle that where small claims are involved, it is important that there be early finality in determination of litigation, otherwise the costs that will be involved are likely to swamp the money sum involved in the dispute."

[33] In Jaycar Pty Ltd v Lombardo [2011] NSWCA 284 Campbell JA, with the agreement of Young and Meagher JJA, expanded on his summary of Carolan, noting that Kirby P had recognised "that ordinarily it was appropriate to grant leave to appeal only concerning matters that involve issues of principle, questions of general public importance or an injustice which is reasonably clear, in the sense of going beyond [what is] merely arguable": at [46].

[34] Kirby P in Carolan set out a number of reasons for the constraint on rights of appeal in such cases. Not all of them have been repeated in later cases. Not all are universally relevant. Thus, the delay in obtaining a hearing in this Court appears to have been greater at that time than is the case presently, although an overly liberal approach to leave applications might well result in an increase in the period between filing and hearing.

[35] In Coulter v The Queen [1988] HCA 3; 164 CLR 350, dealing with a challenge to a refusal of the South Australian Full Court to grant leave to appeal in a criminal matter, the majority noted that a leave requirement was a preliminary procedure "recognised by the legislature as a means of enabling the court to control in some measure the volume of appellate work requiring its attention": at 356 (Mason CJ, Wilson and Brennan JJ). That statement is clearly applicable to civil, as well as criminal, appellate jurisdiction.

[36] As the High Court has noted, an application for leave is not a proceeding in the ordinary course of litigation but a preliminary procedure: Collins v The Queen [1975] HCA 60; 133 CLR 120 at 122; Coulter at 356. On the other hand, there is no reason to doubt that s 58 of the Civil Procedure Act 2005 (NSW), requiring a court to act in accordance with "the dictates of justice" when making an order or direction "for the management of proceedings", applies in respect of a leave application. One of the factors to be taken into account pursuant to s 58 is "the degree of injustice that would be suffered by the respective parties as a consequence of any order or direction": s 58(2)(b)(vi). That provision, like s 56, identifying the overriding purpose of the Civil Procedure Act as being to facilitate the just, quick and cheap resolution of the real issues in the dispute, recognises that questions of injustice are relative. Similarly, the requirement that this Court not order a new trial unless it appears that "some substantial wrong or miscarriage" has been occasioned, also reflects a principle of parsimony in requiring that the parties be put to the expense of a second trial: UCPR, r 51.53.

[37] The idea that injustice may be measured on a scale reflects a number of underlying considerations. First, the ability to assess the existence of an injustice in a preliminary proceeding, such as a leave application, is limited. In assessing the merit of a proposed appeal, the Court may well apply a vague criterion, such as whether the judgment below is attended by "sufficient doubt". Secondly, injustice involves a balancing exercise. The delay and cost of further litigation will constitute a form of injustice to the successful party below, whatever the outcome of the appellate process. Thirdly, the entitlement of the parties to justice is not unconditional, but is dependent upon the resources of the court made available by the government and the appropriate allocation of resources by the parties, which may depend upon their individual assessments of the importance of the issues in dispute. The parties may well make disparate assessments in a particular case.”

Principles in relation to construction of contract

As to the principles of construction, the owner made reference to a passage approved by Gleeson CJ, Gummow & Hayne JJ in Maggbury Pty Ltd v Hafele Australia Pty Ltd (2001) 210 CLR 181; [2001] HCA 70 at [11], citing Lord Hoffman in Investors Compensation Scheme Ltd v West Bromwich Building Society [1998] 1 WLR 896 at 912:

“(1) Interpretation is the ascertainment of the meaning which the document would convey to a reasonable person having all the background knowledge which would reasonably have been available to the parties in the situation in which they were at the time of the contract.”

The owner submitted that the primary task of the Court is to give the contractual terms their proper meaning: the Court should give “primacy to its text but read in light of the contract as a whole and where appropriate its surrounding circumstances”: Cirrus Real Time Processing Systems Pty Ltd v Jet Aviation Australia Pty Ltd (2023) 113 NSWLR 80; [2023] NSWCA 280 at [79] (per Leeming JA).
The owner also placed reliance on the following passage in Chapmans Ltd v Australian Stock Exchange Ltd (1996) 67 FCR 402 at 411 (per Lockhart and Hill JJ):

“It is an elementary proposition that a contract will be read as a whole giving weight to all clauses of it, where possible, in an endeavour to give effect to the intention of the parties as reflected in the language which they have used. A court will strain against interpreting a contract so that a particular clause in it is nugatory or ineffective, particularly if a meaning can be given to it consonant with other provisions in a contract.”

Lastly, the owner submitted that “notwithstanding arguable deficiencies in a contract, a court must strive to give meaning and effect to all of its clauses”: Price v Spoor (2021) 270 CLR 450; [2021] HCA 20 at [60] (per Steward J).
For present purposes, I also adopt the following principles stated in Tin-Tagel Majikk Pty Limited v Hockey [2025] NSWSC 578 (at [149] – [151]) for the principles on construction:

“[149] An authoritative statement of the principles for the construction of a commercial contract were provided by the High Court in Electricity Generation Corporation (t/as Verve Energy) v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7 (“Electricity Generation”) at [35] (per French CJ, Hayne, Crennan and Kiefel JJ) as follows:

“[35] Both Verve and the Sellers recognised that this Court has reaffirmed the objective approach to be adopted in determining the rights and liabilities of parties to a contract. The meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean. That approach is not unfamiliar. As reaffirmed, it will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract. Appreciation of the commercial purpose or objects is facilitated by an understanding "of the genesis of the transaction, the background, the context [and] the market in which the parties are operating". As Arden LJ observed in Re Golden Key Ltd, unless a contrary intention is indicated, a court is entitled to approach the task of giving a commercial contract a businesslike interpretation on the assumption "that the parties … intended to produce a commercial result". A commercial contract is to be construed so as to avoid it "making commercial nonsense or working commercial inconvenience".” (footnotes omitted)

[150] The judgment in Electricity Generation has been more recently been applied, albeit in a variety of contexts involving the construction of a contract or an instrument, in Young v Chief Executive Officer (Housing) (2023) 278 CLR 208; [2023] HCA 31 (“Young”) at [27] (per Kiefel CJ, Gageler and Gleeson JJ); Construction, Forestry, Maritime, Mining and Energy Union v Personnel Contracting Pty Ltd (2022) 275 CLR 165; [2022] HCA 1 (“CFMEU”) at [173] (per Gordon J); Price v Spoor (2021) 270 CLR 450; [2020] HCA 20 (“Price”) at [60] (per Steward J); Rinehart v Hancock Prospecting Pty Ltd (2019) 267 CLR 514; [2019] HCA 13 at [44] (per Kiefel CJ, Gageler, Nettle and Gordon JJ); Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544; [2017] HCA 12 (“Ecosse Property Holdings”) at [16]-[17] (per Kiefel, Bell and Gordon JJ), [73] (per Nettle J); Simic v NSW Land and Housing Corporation (2016) 260 CLR 85; [2016] HCA 47 at [78] (per Gageler, Nettle and Gordon JJ); Mount Bruce Mining Pty Ltd v Wright Prospecting Pty Ltd (2015) 256 CLR 104; [2015] HCA 37 at [46]–[52] (per French CJ, Nettle And Gordon JJ).

[151] From those authorities, the following statements of principle may be derived:

(1) The meaning of the term of a commercial contract is to be determined objectively by what a reasonable businessperson would have understood those terms to mean: Electricity Generation at [35]; Price at [60].

(2) That analysis is not to be undertaken by reference to the subjectively stated intentions of the parties to the contract: Ecosse Property Holdings at [16], citing Electricity Generation at [35].

(3) An objective factor will require consideration of at least three factors…

(4) One such assessment is that there must be a consideration of the language used by the parties in the contract. What is required, in that respect, is a consideration of the totality of the legal requirements and obligations provided for in the contract: CFMEU at [173]. The court must strive to give meaning and effect to the contract by consideration of the whole of the instrument: Australian Broadcasting Commission v Australasian Performing Rights Association Ltd (1973) 129 CLR 99; [1973] HCA 36 (“ABC”) at 109 (per Gibbs J), and thereby giving effect to all of the clauses of the contract such that the words of every clause must, “if possible be construed so as to render them all harmonious one with another”: ABC at 109.

(5) Such an assessment necessarily involves a consideration of context which may involve consideration of the second factor discussed below but must necessarily involve a consideration of the surrounding words of the provisions of the instrument or contract being construed: ABC at 109 or relevant statutory provisions: Young at [27].

(6) … the principles stated in Western Sydney Wanderers which was a derivative of statements of principle by Gibbs J in ABC at 109... The full statement was as follows: [6]

“If the words used are unambiguous the court must give effect to them, notwithstanding that the result may appear capricious or unreasonable, and notwithstanding that it may be guessed or suspected that the parties intended something different. The court has no power to remake or amend a contract for the purpose of avoiding a result which is considered to be inconvenient or unjust. On the other hand, if the language is open to two constructions, that will be preferred which will avoid consequences which appear to be capricious, unreasonable, inconvenient or unjust, "even though the construction adopted is not the most obvious, or the most grammatically accurate", to use the words from earlier authority cited in Locke v. Dunlop, which, although spoken in relation to a will, are applicable to the construction of written instruments generally; see also Bottomley's Case” (emphasis added)

(7) Secondly, it is necessary to consider the surrounding circumstances known to the parties: Electricity Generation at [35].

(8) Thirdly, consideration should be given to the commercial purpose or objects to be secured by the contract: Electricity Generation at [35].”

Further, as Bathurst CJ observed in Lawrence v Ciantar [2020] NSWCA 89 (“Lawrence Appeal”) at [98]:

“The principles surrounding the construction of commercial contracts in this country are well established. In Electricity Generation Corporation v Woodside Energy Ltd (2014) 251 CLR 640; [2014] HCA 7 at [35], the plurality (French CJ, Hayne, Crennan and Kiefel JJ) stated that “[t]he meaning of the terms of a commercial contract is to be determined by what a reasonable businessperson would have understood those terms to mean” in context. The Court stated that “it will require consideration of the language used by the parties, the surrounding circumstances known to them and the commercial purpose or objects to be secured by the contract”: see also Mount Bruce Mining at [46]-[49]; Simic v New South Wales Land and Housing Corporation (2016) 260 CLR 85; [2016] HCA 47 at [78]; Ecosse Property Holdings Pty Ltd v Gee Dee Nominees Pty Ltd (2017) 261 CLR 544; [2017] HCA 12 at [16]; Victoria v Tatts Group Ltd (2016) 90 ALJR 392; [2016] HCA 5 at [51].”

PROCEDURAL HISTORY

The tribunal proceedings and decision

On 2 August 2023, the builder brought proceedings in NCAT as a "building claim" relating to "building goods and services" (as those terms are defined in s 48A(1) of the HB Act), and sought an order under s 48(1)(a) of the HB Act, that the owner pay an amount of $74,374.63 for breach of the contract, comprising damages of $79,000 (the equivalent of 15% of the contract’s purchase price (pursuant to cll 29 and/or 44.15 of the contract), plus $9,874.63 (being reimbursement of fees and charges) less $15,000 (being a credit for the tender fee paid by the owner)).
The issue as to whether the contract precluded the builder’s claim was a key issue before the Tribunal. The Points of Defence for the owner included:

“THE CONTRACT

25. The Contract:

a. was prepared by the Applicant;

b. was not able to be negotiated as to its printed terms by the Respondent.

26. Pursuant to clause 39.1(c) of the Contract, the Applicant must ensure that "the building works will be done in accordance with, and will comply with, the Home Building Act or any other law".

27. The Applicant breached Clause 39.1(c).

Particulars

a. The Respondent pleads the contents and particulars set out under paragraphs 21, 22, 23 & 24 herein.

28. It is an essential term of the Contract that the Applicant has in force, a policy of insurance required by the Act and provide the Respondent with a certificate of insurance before it can carry out any building works or receive any part of the contract price.

Particulars

a. The Contract entered into by the parties and dated 22 June 2022 at the following locations provided that the Applicant could not demand or receive payment under the Contract if it did not have a contract of insurance in place:

i. Item 2(a) of Schedule 1 - Particulars of Contract

ii. Schedule 6 - Warranty Insurance;

iii. Notation on page 11;

iv. Clause 38;

v. Item 13 of Attachment A; and

vi. Attachment B,

("the Essential Terms").

29. The Applicant failed to comply with the Essential Terms and breached the Contract.

b. The Respondent pleased the particulars set out under paragraphs 21,22 & 27 28 herein.”(Bolding, underlining and italics in original)”

The builder’s submissions

The Tribunal summarised, in part, the builder’s submissions in the following paragraphs of the Tribunal Decision.

“[50] These submissions commence with Champion Homes noting that Mrs Voulgaris:

(1) has not filed any evidence in reply to the substantive issues raised in the Applicant's material, other than a statement by her solicitor Mr Joseph Antoun going to the question of costs;

(2) has only raised a legal defence which lead to the following questions to be answered by the Tribunal:

(a) whether the operation of s 92(1) of the Act required Champion Homes to have a policy of insurance complying with the Act force before undertaking any of the obligations under the contract?

(b) If the answer to (a) is in the affirmative does the operation of ss92(2) and 94 of the Act prevent Champion Homes from making the claims?

(c) the meaning of "residential building work" and "supply of building goods and services".

[51] In summary, Champion Homes submits that on the authorities and the proper construction of the Act and the specific sections relied upon Mrs Voulgaris, it is entitled to the remedy it seeks.”

I interpose to note that, in reply dated 7 February 2024, the builder submitted to the Tribunal (“the builder’s Tribunal reply”), that the owner’s submissions should be rejected because (at [75] of the Tribunal Decision):

“(1) the contract case argument cannot be maintained on a proper interpretation of the contract and because it ultimately relies on the legislative argument; and

(2) the legislative argument must fail on the proper assessment of the current state of the law.”

The builder made further submissions in the builder’s Tribunal reply, in that respect, including:

“[5] The contract in the present circumstances is governed by both the contractual terms and the legislated requirements under the Home Building Act (the Act”) which govern its interpretation and purpose.

[6] The obligation for insurance of the work is governed both by the contract and more precisely the legislation which obliges the builder to obtain insurance which complies with the Act (s92).

…

[8] It follows, that in considering the requirement for insurance under the contract both contractual terms and legislation need to be considered: Mount Bruce Mining.

…

[14] The respondent has neglected to take into account clause 1.2 of the contract (page 52) which reads:

“In this contract the general notes, the table of contents, clause headings and sidenote did not form part of the contract and cannot be used in its interpretation.”

[15] Not only do these notes not form part of the contractual relationship between the parties but the respondent has rather egregiously converted these notes into terms and conditions of the contract. This is impermissible within the contractual relationship between the parties.

…

[21] it follows then that what is required is the examination of what is the requirement for insurance and what is the nature of work requiring warranty insurance. It is only a demand for monies requiring warranty insurance which is prohibited from being made without such insurance.”

Hence, the builder engaged with the Points of Defence by reference to the terms of the contract but also relied upon an argument that the HB Act impacted the construction of the contract.
While it was not expressed with clarity, the builder seemed to develop an argument that the contract provisions should be construed in such a way that the requirement to obtain warranty insurance, and the limit on claims by builders if no such insurance has been taken out, needs to be read in conjunction with, or co existing with, the HB Act such that the requirements of the HB Act would govern (and limit) the scope of the contract.
On this contention, the prohibition on claims where no warranty insurance had been taken out only applied with respect to “residential building work” as defined in Sch 1 of the HB Act.
The following submissions by the builder were recorded as having been made before the Tribunal (at [54], [59] – [61] and [64] of the Tribunal Decision):

“[54] …

(1) the jurisprudence associated with “this provision” conflates the jurisdiction issue under s 48A of the Act with the insurance requirements by equating building supply and services with residential building works,

and

(2) that upon the proper interpretation of the Act, the Applicant has not provided residential building work as defined under the Act and accordingly is not in breach of the Act in not obtaining homeowners insurance prior to the physical commencement of building works.

…

[59] Champion Homes then notes that s 92(2) of the Act provides:

"A person must not demand or receive a payment under a contract for residential building work (whether as a deposit or other payment and whether or not work under the contract has commenced) from any other party to the contract unless:

(a) a contract of insurance that complies with this Act is in force in relation to that work in the name of the person who contracted to do the work,

and

(b) a certificate of insurance evidencing the contract of insurance, in a form prescribed by the regulations, has been provided to the other party (or one of the other parties) to the contract."

[60] Champion Homes then notes that "residential building work" in the Act is relevantly defined as meaning "any work involved in, or involved in coordinating or supervising any work involved in the construction of a dwelling".

[61] Champion Homes submits that:

(1) there is clear distinction in the wording of the section between the "supply of building goods and services" and "residential building works".

(2) ss 92 and 94 of the Act require a policy of insurance complying with the Act "in relation to that work" being "residential building work".

…

[64] …

95 When the Act is properly construed in accordance with the principles laid out in Project Blue Sky the requirement for insurance and the enlivenment of sections 92 and 94 are predicated on insurance for causal physical work carried out in relation to the construction of a dwelling.

96 As the applicant has not carried out such work the provisions of ss 92 and 94 have no application.

97 The obtaining of a contour survey, site classification report and report as to the location of Sydney Water assets and the drafting of architectural plans do not constitute work involved in the construction of a dwelling and are, in any event, as Bathurst CJ observed in Lawrence, too remote to fall within the definition of "residential building work”.

[65] Accordingly, Champion Homes submits that the Contract, not being void or voidable, stands on its merits and the applicant is entitled to bring the claim without first having insurance under the Act as insurance is not necessary.”

The owner’s submissions

The Tribunal summarised the gravamen of the owner’s submissions as follows:

“[66] In summary, Mrs Voulgaris submits that Champion Homes’ claim must for any one or more of the following reasons:

(1) the Contract itself makes the obtaining of warranty insurance and the provision to Mrs Voulgaris of a certificate of that insurance a precondition to any entitlements to claim or retain any of the contract price — in this regard the principles of contra pr[o]ferentem further support Mrs Voulgaris' claim.

(2) separately from the contractual point in (a) above, ss 92(2) and 94 of the Act preclude Champion Homes claiming under the Contract where the insurance has not been obtained.”

In respect of damages and the interpretation “residential building works”, the owner further submitted to the Tribunal, in their submissions dated 29 January 2024 (“owner’s Tribunal submissions”), as follows:

“[17] … If the Builders actions are not residential building work – as tied to the agreement to produce a two-storey house for $530,000 in the Contract – then the 15% is a penalty because there is no nexus (on the Builder’s new argument) to the $530,000. The contract price from which the 15% is calculated was for the construction of a dwelling not the mere procurement of the DA.

…

[18] Further, the Contract expressly states that the builder is responsible for obtaining “all planning and building approvals…… The builder as an agent for the Owner”: item 10 of Schedule 1 of the Contract. That is, the Builder was obliged – as part of the Contract and not separately to the Contract – to obtain the approvals. It therefore cannot be said that the works the Builder had performed to date was not residential building works as part of the Contract.”

At [67] – [68] of the Tribunal Decision, the Tribunal referred to the owner’s submission that the contract itself defeated the builder’s claim:

“The Contract itself

67 Mrs Voulgaris submits that [the builder’s] own bespoke Contract states in at least six places that none of the Contract price can be claimed or retained by the [the builder] without it having obtained warranty insurance (which [the builder] did not obtain) and having provided the certificate of insurance to [the owner] (which it did not do).

68 Mrs Voulgaris submits that the Contract is clear and [the builder] is bound by the terms it prepared. If there were any ambiguity in those terms (which [the owner] submits there is not) it is resolved by interpreting the Contract against the Builder per the contra pr[o]ferentem rule: see Mann v Paterson Constructions Ply Ltd [2019] HCA 32; (2019) 267 CLR 560 where the High Court construed a home building contract against a builder.”

The Tribunal Decision: the contract

With that background in mind, I turn first to the Tribunal Decision, in so far as it related to the contract, noting that the Tribunal dealt separately with the issues arising in contract and the issues arising under the HB Act. The Tribunal’s conclusions, in dismissing the builder’s claim, in that respect, were discrete.
The Tribunal discussed the issues of the contract at [18] – [21], [67] – [68], [75(1)] and [87] – [89] of the Tribunal Decision.
The Tribunal found that there were two issues to be determined by the Tribunal (at [46] – [48] of the Tribunal Decision):
“First, should the application of Champion Homes be dismissed for the reasons submitted by Mrs Voulgaris?”
“Secondly, if not, what order should the Tribunal make?”
Under the heading “Consideration of the first issue – should the application be dismissed for the reasons submitted by Mrs Voulgaris?”, the Tribunal found in favour of the owner in relation to issues arising with respect to the contract, observing that the owner’s "submissions [were] plainly correct and supported by abundant authority".
The Tribunal Decision held that the builder could not, on the contract alone, recover the claimed sum. The Tribunal reasoned that the contract itself prohibited the demand for, or receipt of, the contract price, until the certificate of insurance had been given to the owner. That condition precedent in the contract was, as found by the Tribunal, not satisfied.
The relevant passages of the Tribunal Decision with respect to that finding, were as follows:

“[86] In my view, for the reasons advanced by [the owner] in her submissions [the builder] is precluded from recovering the damages sought. I consider that [the owner] submissions to be plainly correct and supported by abundant authority.

[87] The starting point is that, as [the owner] submits, [the builder’s] own bespoke Contract states in at least six places (set out above) that none of the Contract price can be claimed or retained by [the builder] without it having obtained warranty insurance (which [the builder] did not obtain) and having provided the certificate of insurance to [the owner] (which it did not do).

[88] I accept, for the reasons advanced by [the owner] that the $79,500 formed part of the Contract price: namely: the amount is defined as being 15% of the Contract price, and does not exist independently of the Contract price.

[89] [the owner] submits, and I accept, that the Contract is clear and [the builder] is bound by the terms it prepared. If there were any ambiguity in those terms (which [the owner] submits there is not) it is resolved by interpreting the Contract against the Builder per the contra pr[o]ferentem rule: see Mann v Paterson Constructions Ply Ltd [2019] HCA 32; (2019) 267 CLR 560 where the High Court construed a home building contract against a builder.”

The Tribunal found that there was “no persuasive response” by the builder to the owner’s submissions, in this respect.
The Tribunal Decision recorded that, following the hearing, the parties were invited to make submissions on the following issue (at [84] of the Tribunal Decision):

“whether or not the damages of $79,500 (being 15% of the Contract price pursuant to cll 29 and/or 44.15 of the Contract) claimed by the applicant forms part of the “Contract price”, noting that the respondent’s principal argument is that none of the Contract price can be claimed or retained by the Champion Homes without it having obtained warranty insurance (which Champion Homes did not obtain) and having provided the certificate of insurance to Mrs Voulgaris (which it did not do).”

The Tribunal did not refer at length to the submissions received, in that respect, but disposed of that issue by its finding at [88], which is extracted above. The summary of the parties’ submissions was as follows (at [85] of the Tribunal Decision):

“[85] In summary:

(1) Champion Homes submitted that the $79,500 is for damages pursuant to the agreed damages clause and is not and does not constitute any part of the Contract price.

(2) Mrs Voulgaris submitted that the Contract price included the $79,500.”

The Tribunal Decision: the HB Act

I turn then to those aspects of the Tribunal Decision regarding the operation of the HB Act.
At [92] of the Tribunal Decision, the Tribunal accepted the owner’s submission that:

“… the prescribed quantum of works is $20,000 plus GST, so at $530,000 this Contract is over the relevant threshold. By cl 2 of Sch 1 to the Act, the Contract deals with residential building work. Therefore, given the common fact that Champion Homes did not give a certificate of insurance to Mrs Voulgaris it is precluded from recovering any amounts (s 94) or of enforcing the Contract in any way (s 10).”

The Tribunal ultimately found (at [96] of the Tribunal Decision):

“96 I see no reason to exhaustively canvass all the other submissions and authorities referred to and relied by Champion Homes. In my view, the issue is settled; the policy of the Act requires residential building work to be insured; residential building work includes preparatory work (Grygiel), this preparatory work was not insured, de ipso facto, “the contractor who did the work … is not entitled to damages, or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract”.”

Hence, the Tribunal found:
That the contract itself barred the builder form claiming any part of the contract price, including the 15% damages amount, unless it had obtained warranty insurance and provided the certificate to the owner, which it had not done (at [67] – [68], [86] – [90] of the Tribunal Decision).
That the provisions of the HB Act also precluded the builder from recovering the amount claimed (at [86], [90] – [96] of the Tribunal Decision).

THE APPEAL PANEL PROCEEDINGS AND DECISION

On 21 August 2024, the builder brought an internal appeal against the Tribunal Decision, pursuant to s 80(2) of the NCAT Ac**t.
As a Costs Decision was published after the lodgement of appeal, the builder further sought to appeal that Costs Decision in their written submissions dated 2 October 2024.
Section 80 of the NCAT Act permits an appeal from a first instance decision of NCAT “as of right on any question of law, or with the leave of the Appeal Panel, on any other grounds”: s 80(2)(b) of the NCAT Act.
The builder articulated 12 grounds of appeal in their Notice of Appeal, all of which, they submitted, raised questions of law. The grounds of appeal were as follows (at [47] of the Appeal Panel Decision):

“(1) In failing to provide proper reasons as to why the Builder’s submissions were not accepted and should be rejected at [86] of the Substantive Decision (Ground 1),

(2) In holding that the Builder’s claim for damages was or formed part of the Contract Price (Ground 2),

(3) In concluding that the claim for damages was a claim for payment under the Contract (Ground 3),

(4) In holding that the Builder’s claim that s 92 of the HB Act required a contract of insurance under s 92 to be in force before a claim can be made: at [93] & [94] of the Substantive Decision (Ground 4),

(5) In failing to decide whether work undertaken by the Builder as at date of termination was “residential building work” for the purposes of s 92 of the HB Act (Ground 5),

(6) In failing to articulate any reasons why the Owner’s submissions on the decision in Syed v Jandson is binding on the Tribunal and should be accepted in preference to the Court of Appeal’s decision (per Bathurst CJ at [123] – [131]) in Lawrence v Ciantar as submitted by the Builder (Ground 6),

(7) In failing to provide any or any articulate reasoning in response to the Builder’s submissions and analysis of the relevant caselaw: at [62] of the Substantive Decision (Ground 7),

(8) In failing to consider or decide on the Builder’s claim of $9,874.63 as claimed in paragraph [19] of the Builder’s Points of Claim and make orders accordingly (Ground 8),

(9) In failing to consider the Owner’s admission that the Builder was entitled to recover the amount of the work undertaken in the sum of $9,874.63 in paragraph [19] of the Owner’s Amended Points of Defence (Ground 9),

(10) In holding that the Builder had suffered a “similar outcome” in the Tribunal’s decision in Biggs where the obiter dicta in that case at [10] – [12] dealt with the Tribunal’s jurisdiction and not the issue of insurance: at [72] of the Substantive Decision (Ground 10),

(11) In its construction and operation of s 92 and s 94 of the HB Act (Ground 11),

(12) In its interpretation of the Contract and its purported application of the c*ontra pr[o]*ferentum rule: at [89] of the Substantive Decision (Ground 12).”

On 29 November 2024, the Appeal Panel dismissed the builder’s appeals to the Tribunal Decision and Costs Decision brought by the builder (at [120] of the Appeal Panel Decision).
The Appeal Panel made the following orders (at [122] – [123]):

“[120] The appeals of Champion Home Sales Pty Ltd from the orders of the Tribunal for case no HB 2023/00382187 in the Substantive Decision made on 29 July 2024 and the Costs Decision made on 18 September 2024, are dismissed.

[121] Champion Home Sales Pty Ltd is to pay the respondent’s costs of the appeals on the ordinary basis, as agreed or assessed.

[122] The following orders apply if a party contends for a different costs order in relation to the appeal proceedings:

(a) Order 2 above ceases to have effect if an application for a different costs order is made in the appeal proceedings.

(b) The party contending for a different costs order (the costs applicant) is to file and serve the application for costs, supported by evidence and submissions, within 14 days of the date of these orders.

(c) The other party (the costs respondent) is to file and serve any evidence and submissions in response to the costs’ application within 28 days of the date of these orders.

(d) The costs applicant is to file and serve any material in reply within 35 days of the date of these orders.

[123] Subject to the parties’ submissions on this point, the Appeal Panel proposes to determine any application for a different costs order in the appeal proceedings without a hearing based on the written submissions and evidence provided, pursuant to s 50(2) of the Civil and Administrative Tribunal Act 2013 NSW.”

The Appeal Panel observed (at [40(2)] and [40(4)]), that, contrary to Ground 1, the Tribunal had found that the contract precluded the builder’s claim:

“The Tribunal’s Reason for the Substantive Decisio****n

…

40 The Tribunal found, relevantly, in its Substantive Decision:

(1) The Builder is seeking payment under a Contract for residential building work within the meaning of the HB Act and is thereby precluded from recovering the damages it seeks (i.e., the amount of $74,374.63) by reason of the effect and operation of s 10(1), s 92(2) and s 94(1)(a) of the HB Act: see the Substantive Decision at [86] – [96].

(2) The Builder’s “own bespoke Contract” (Substantive Decision at [87]) stated in at least six (6) places that none of the Contract Price can be claimed or retained by the Builder without it having obtained home warranty insurance (which the Builder did not obtain) and without it having provided the certificate of insurance to the Owner (which the Builder did not do).

(3) The $79,500 claimed by the Builder as “damages” formed part of the Contract Price and that it is the amount, which is: “defined as being 15% of the Contract Price and does not exist independently of the Contract Price” (Substantive Decision at [88]).

(4) The Builder is bound by the terms of its own Contract which are clear, and if there is any ambiguity, by interpreting the Contract against the Builder per the contra pr[o]ferentum rule, citing Mann v Paterson Constructions Pty Ltd [2019] HCA 32; (2019) 267 CLR 560 (Mann v Paterson) where it is said that the High Court construed a home building contract against a builder (Substantive Decision at [89]).”

I turn then to the Appeal Panel’s consideration in respect of each other ground of appeal raised by the builder.

Grounds of appeal: introduction

Having dispensed with Ground 1 concerning the adequacy of reasons, the Appeal Panel then proceeded to deal, in groups, with various grounds for the disposition of the remainder of the appeal.
The Appeal Panel explained their reasons for grouping certain grounds of appeal together, as follows:
Grounds 2, 3 and 4 concerned [88] of the Tribunal Decision, The Appeal Panel described those issues, and their correlation, in the following way:

**“**Grounds 2, 3, & 4 – Damages

56 These 3 grounds of the appeal refer to the Tribunal’s finding at [88] of the Substantive Decision that the Builder’s damages calculated as 15% of the Contract Price, were a payment of the Contract Price or a part thereof. The Builder contends that its damages’ amount of $79,000 (i.e., before the addition of the $9,874.63 for reimbursement of fees and charges, and the subtraction of the credit of $15,000 for the tender fee, to calculate the claim of $74,374.63), is independent of the Contract and therefore, it is not related to the Contract Price, because contractually, clauses 29(1)(b) and 44.15 do not lend themselves to that construction. The language of those clauses “in the sum equivalent to” provides, in the Builder’s submission, a formula to calculate the damages payable at the end of the Contract to the Builder, and in that way, cannot be phraseology which permits the interpretation that damages are a payment of part of the Contract Price.”

Grounds 4 and 11 were grouped together on the basis that they concerned the interpretation of the HB Act, and in particular, s 92 of the HB Act, although the Appeal Panel considered that s 94 of the HB Act was pivotal to the resolution of those issues.
Grounds 4, [2] 5, 6 and 7 were addressed collectively, as those grounds of appeal were said to challenge the decision in Syed with respect to the meaning of “residential building work”.
Grounds 8 and 9 were grouped together because they were said to deal with the following issue:

“[82] These grounds refer to the amounts totalling $9,874.63 which were claimed by the Builder under clause 5 of the Contract (see [19] of the points of claim) on account of its out-of-pocket expenses for geotechnical report, contour survey, council application fees, engineering detail, and sewer peg out.”

Ground 10 was addressed independently and addressed the decision in Champion Homes Sales Pty Ltd v Biggs*; Biggs v Champion Homes Sales Pty Ltd* [2023] NSWCATCD 117 (“Biggs”).
Ground 12 was also addressed independently and bore the heading “Grounds 12 – The contra preferentem rule and Mann v Paterson”.

The Appeal Panel Decision:

Grounds 2, 3 & 4 – Damages

On appeal, the builder submitted that 15% was not part of the contract price, inferring that it was "independent of the Contract" and merely "a formula to calculate damages". I have earlier set out the builder's submissions, in this respect, as summarised in the Appeal Panel Decision.
In respect of Grounds 2, 3 and 4, the Appeal Panel found:

“[57] In our view, the Builder’s submission focuses upon the manner of calculation of the quantum of the damages under clauses 29(1)(b) and 44.15, which is not in dispute, but does not address, adequately, or at all, the legal basis of what the amount of $79,500 is compensating to it, if that amount is not an entitlement arising under the Contract. Materially, this question is not answered by the Builder’s submission that agreed damages clauses such as clauses 29(1)(b) and 44.15, stand, unless shown to be a penalty.

[58] Although the Owner contends that the Builder’s claim for damages under those clauses operates as a penalty in the circumstances, it is unnecessary for us to decide that matter. This is because, in our determination, the Contract Price is the only benefit to which the Builder is entitled under the Contract. There is no relationship between the Builder and the Owner other than the Owner’s engagement of the Builder to construct a two-storey dwelling on the Site for the Contract Price.

[59] In the circumstances of this case, it was the Owner’s failure to put funds commensurate with the Contract Price into a bank account as a security deposit, that gave rise to the Builder’s right to terminate the Contract and thereafter, to make its claim for $74,374.63 under the agreed damages’ clauses. Furthermore, the claim in the amount of $74,374.63 necessarily refers to the Contract Price, because of the credit ($15,000) allowed for the tender fee. As was stated in Mr Malesev’s statement of 25 October 2023 at [16], and which was accepted as an agreed fact for the Tribunal’s hearing on the papers on 29 July 2023, the amount of $15,000 “would be credited towards the contract price upon entering into a building contract”.”

The Appeal Panel then made the following conclusions, in this respect:

“[60] Moreover, these grounds of the appeal must fail because of the terms of the Contract, which the Builder prepared, and which the Builder has not complied with. Pertinently, the Contract says in various places (i.e., Schedule 1 ‘Particulars of Contract’, Schedule 6 ‘Warranty Insurance’, immediately after the Builder’s signature space, and General Conditions, clauses 1, 3, 38, and 39) that none of the Contract Price can be claimed or retained by the Builder without it having obtained home warranty insurance (which the Builder did not obtain) and without it having provided a certificate of insurance to the Owner (which the Builder did not do).”

That paragraph represented a further limb of the Tribunal’s reasoning for rejecting grounds 2, 3 and 4. In substance, the Appeal Panel found that the builder’s claim was unsustainable as a result of the fact that:
the builders’ claim formed part of the contract price; and
the builder had not taken out warranty insurance (as required by cl 38 and the Notations).
The Appeal Panel further rejected Grounds 2, 3 and 4 as a result of the operation of s 92(2) of the HB Act. In this respect, the Appeal Panel held (at [61] of the Appeal Panel Decision):

“[61] Fundamentally, the Builder’s argument about the liquidated damages not being part of the Contract Price cannot advance its case for relief under the HB Act in any event considering s 92(2), because under that sub-section, requiring a payment under a contract to do residential building work without insurance is not allowed, whether (or not) work has commenced.”

Grounds 4 & 11- Interpretation of HB Act

Grounds 4 and 11 referred to the Tribunal having erred in its interpretation of ss 92 and 94 of the HB Act, by concluding that those provisions precluded the builder’s claim for orders under the HB Act.
In relation to these grounds, the Appeal Panel upheld the Tribunal’s interpretation of ss 92 and 94 of the HB Act, as follows (at [63] of the Appeal Panel Decision):

“[63] However, these grounds could only be challenging the issue under s 92 because, considering the rejection of Appeal Grounds 2 and 3 for the reasons set out above, in our determination, the issue under s 94 is clear and fatal to the Builder.

[64] Insofar as Ground 11 refers to s 94 of the HB Act, the Builder relies on the same submission in respect of Grounds 2 and 3 (i.e., that its claim under clauses 29(1)(b) and 44.15 are not a payment of the Contract Price). However, those Grounds fail for the reasons already given.”

The Appeal Panel rejected the builder’s submission that no “residential building work under a contract” (within the meaning of the HB Act) had occurred because the builder had only done preparatory work, with no physical construction undertaken on the site.
In that respect, the Appeal Panel found as follows:

“[66] We are satisfied that the Tribunal’s Reasons for the Substantive Decision, sufficiently address the proper interpretation of s 94 and why it operates for the Owner’s benefit in the circumstances. We find that the language of s 94(1)(a) (i.e., “is not entitled to damages, or to enforce any other remedy”) clearly encompasses the Builder’s damages’ claim. Moreover, the Builder, not having home warranty insurance and therefore being in breach of s 94, is disentitled by s 10 of the HB Act to damages or to enforce any other remedy in respect of a breach of the contract committed by any other party to the contract.

…

[68] We disagree with the Builder’s submission. It is contrary to a line of authorities – discussed below - commencing with Grygiel v Bayne, where Basten JA (with whom Mason P agreed) said at [57]:

On one view, the definition of “residential building work” is not limited to activities, such as laying of foundations and painting a building on site but extends to work of a preparatory nature.

[69] Work of a preparatory nature references the definition of “residential building work” in clause 2(1)(a) of Schedule 1 of the HB Act, as follows:

any work involved in, or involved in co-ordinating or supervising any work involved in--

(a) the construction of a dwelling …

[70] We are satisfied that the preparatory work on Site required by the DA was work involved in co-ordinating or supervising work for the construction of the two-storey dwelling on Site which was the subject of the Contract, and that this constituted “residential building work” as that expression is defined in the HB Act.

[71] Further, even if that were not the case, the prohibition against demanding or receiving a payment under a contract for residential building works without an insurance certificate in s 92(2) applies whether (or not) work under the contract has commenced. The Builder’s claim for liquidated damages was a demand for payment under a contract to do residential building work.”

It is plain that the Appeal Panel considered that the building works the builder undertook constituted “residential building work” within the meaning of the HB Act, and accordingly, determined that Grounds 4 and 11 failed.

Grounds 4, 5, 6 & 7 – Challenge to Syed v Jandson

In the Tribunal Decision, the Tribunal had applied a decision of another NCAT Appeal Panel, Syed (see [93] and [96] of the Tribunal Decision). In that respect, Grounds 4, 5, 6 and 7 of the appeal challenged the reasoning in Syed (at [263] – [275] and [295]) in relation to the meaning of “residential building work”.
The builder’s challenge before the Appeal Panel, referred to Lawrence Appeal where Bathurst CJ (with whom Meagher & Gleeson JJA agreed) stated (at [128] – [131]):

“[128] By contrast to the definition of “building goods or services”, the definition of “residential building work” uses the expression “work involved in the construction of a dwelling”. That may include preparatory work such as laying foundations or otherwise preparing the site for construction (noting that demolition work is expressly excluded), but it does seem to me to require a closer connection with the construction of a dwelling than that required for a claim to fall within the definition of “building goods or services”.

[129] Whilst the work in question in the present case – “[e]stablish the requirements as to any variations in the manhole and the 150 mm drainpipe” – may be said to be work in connection with the proposed subdivision, in my opinion, such an investigation is too remote to fall within the definition of “residential building work”.

[130] It follows this ground of appeal has been made out.

[131] However, having regard to my conclusion on grounds 1 to 5 this conclusion does not affect the result.”

The builder submitted before the Appeal Panel, that it could be inferred from the above passage, that the view reached in Syed, that preparatory work can be “residential building work” for the purposes of the HB Act, is not maintainable and should not have been followed by the Tribunal in the Tribunal Decision.
The builder further submitted that the Court of Appeal had found the words of Basten JA in Grygiel v Baine & Ors [2005] NSWCA 218 (“Grygiel”) at [57], were limited to jurisdiction and not to preparatory work: Lawrence Appeal at [127].
In this respect, the Appeal Panel made the following conclusions (at [75] – [80]):

“[75] We do not read the Court of Appeal decision in Lawrence v Ciantar in the way contended by the Builder in this appeal. Put in its proper context, the Court of Appeal at [123] – [131] was addressing a ground of appeal arising from the primary decision of Henry J in Lawrence v Ciantar; Ciantar v Lawrence (2019) NSWSC 464. On appeal from the primary decision, the appellant argued that certain work of a preparatory nature that had been found to be residential building work, was too remote to fall within the definition of “residential building work” for the purposes of the HB Act.

[76] The work in question before Henry J arose in the context of the preparation of a development application for a 3-lot subdivision of residential property. It was described by the parties’ joint venture agreement in paragraph 6, item 4, as works by way of an investigation to ‘establish the requirements as to any variations in the manhole, and the 150mm drainpipe’. In essence, these were works relating to possible changes to drainage works on the subdivision involving a manhole and drainpipe.

[77] Her Honour (at [143]) had cited Grygiel v Bayne (per Basten JA at [57]) and Syed v Jandson (at [276]) as authorities for the proposition that “works of a preparatory nature may come within the definition of residential building work under the Home Building Act if they are in readiness or preliminary to residential building works”. Henry J had then found (at [145]) that the description in paragraph 6, item 4, of the joint venture agreement, which related to possible drainage works “appear(ed) to be in readiness for, and causally connected to, the DA works”, and that it fell within the definition of “residential building work” for the purposes of the HB Act.

[78] In Lawrence v Ciantar the Court of Appeal found (at [129]) that the work in question may have had a connection with the proposed residential subdivision, but that the work contemplated in paragraph 6, item 4 of the joint venture agreement, was too remote to fall within the definition of “residential building work” (clause 2(1)(a) of Schedule 1 of the HB Act).

[79] In our determination, there is nothing in Lawrence v Ciantar which helps the Builder in this appeal. That case was decided on its own facts, which are materially different to the facts of this case, where the preparatory work was required to be done as a condition of an approved DA for the construction of the residential dwelling. Pertinently, the Court of Appeal was looking at potential issues on a site which were ultimately found not to be work “involved in … the construction of a dwelling” within the definition of “residential building work” in clause 2(1)(a) of Schedule 1 of the HB Act. In this case, the evidence available to the Tribunal pointed to the contrary conclusion. The Court of Appeal did not overturn the line of authority commencing with Grygiel v Bayne, which is that preparatory work, provided it is work “involved in” the construction of a dwelling, can be “residential building work” for the purposes of the HB Act.

[80] To the extent there is any challenge by the Court of Appeal to the reasoning of Syed v Jandson, it is that there must be a close connection between preparatory work and construction. Pertinently, investigative works were performed at the Site in compliance with the DA for the Owner’s dwelling. That is a very different situation to what occurred in Lawrence v Ciantar, where the investigations into necessary specifications were not done on site and were in preparation for the submission of a development application for the residential subdivision, not the construction of a dwelling. By contrast, in the circumstances of this case, there is a more proximate and closer link between the work of a preparatory nature and the construction of the Owner’s dwelling.”

Ultimately, the Appeal Panel dismissed Grounds 4, 5, 6 and 7 (at [81] of the Appeal Panel Decision).

Grounds 8 & 9 – Payment to builder under clause 5

Grounds 8 and 9 referred to the amounts totalling $9,874.63, which were claimed by the builder under cl 5 of the contract.
The Appeal Panel dismissed grounds 8 and 9, providing the following reasons (at [83] of the Appeal Panel Decision):

“[83] We find it is of no moment to the Builder’s appeal because the Owner had conceded in her points of defence that the Builder was entitled to recover the $9,874.63. In our determination, nothing turns on these grounds of appeal. In the events which have occurred, the Builder has retained the $9,874.63. It is part of the $15,000 tender fee, which the Builder received from the Owner on 4 May 2022.”

Ground 10 – Decision in Biggs

The Appeal Panel dismissed this ground of appeal, observing the ground had no merit. The Appeal Panel concluded as follows (at [85] of the Appeal Panel Decision):

“[85] We are satisfied that [95] of the Substantive Decision is not part of the Tribunal’s dispositive reasoning; rather, the paragraph notes that its analysis of binding authority is consistent with the comments made in Biggs at [10] – [11]. Further, for the reasons already given, but especially in the context of the line of authority commencing with Grygiel v Bayne, there was no error in any event.”

Ground 12 - The contra preferentum rule and Mann v Paterson

In approaching the Appeal Panel’s reasoning as to this ground, it is important to understand the true significance of the ground.
Whilst the ground referred to “the interpretation of the Contract”, the ground does not, in substance, challenge the determination of the Tribunal, to which I have earlier referred, that the contract precluded the builder’s claim because the builder failed to take out warranty insurance. To demonstrate the basis for that conclusion, a closer examination of the ground and the Tribunal Decision is required.
To commence this discussion, and for convenience, I set out again Ground 12 of the appeal to the Appeal Panel:

“(12) In its interpretation of the Contract and its purported application of the contra pr[o]ferent[e]m rule: at [89] of the Substantive Decision (Ground 12).”

The Ground is unclear in its terms. It refers to the interpretation of the contract, but then joins to that issue a challenge to the Tribunal’s application of the contra proferentem rule.
The ground also makes reference to [89] of the Tribunal Decision. The Tribunal Decision at [89] has been earlier set out in this judgment at [52]. That paragraph of the Tribunal Decision consists of a primary finding and a secondary finding. The primary finding is that the contract is “clear” and that the builder is bound by its terms. By having regard to [86] to [88] of the Tribunal Decision (again earlier set out), it is plain that the Tribunal concluded that the builder was precluded from recovering the damages it sought by the operation of the contract itself.
The Tribunal then considers a second or alternative position in the event that, contrary to its primary finding, there is some ambiguity in the terms of the contract, in which case the Tribunal sought to interpret the contract using the contra proferentem rule and placed reliance on Mann v Paterson Constructions Ply Ltd [2019] HCA 32; (2019) 267 CLR 560 (“Mann v Paterson”).
In substance, the builder did not challenge the primary finding of the Tribunal. Ground 12 became a challenge to the Tribunal’s application of the contra proferentem rule. That conclusion is reinforced by an examination of the position of the builder during the course of the Appeal Panel proceedings.
I turn firstly to the builder’s submissions to the Appeal Panel.
The written submissions of the builder referred to the central issues in the appeal as follows:

“a. The correct operation of s 92 and section 94 of the Act as it relates to the claim by the Appellant.

b. The extent to which the decision in Syed Ahmad Ali Pty Ltd v Jandson Pty Ltd [2018] NSWCATAP 228 (Jandson) is in conflict with Lawrence v Ciantar [2020] NSWCA 89 (Lawrence) on the interpretation of the terns “ residential building works” under s 92 and 94 requiring a policy of insurance under the Act and “involved in supply of building goods and services” in s48A in determining jurisdiction under the Act.

c. The proper interpretation of the contract as it relates to agreed damages (under either or both clauses 29 or 44.15 of the contract) when the calculation is referenced to the contract sum and particularly whether a claim for specified damages is a “payment under the contract” for the purposes of s 92 (2) of the Act simply because it references the contract price in the formula for the calculation of the agreed damages.

d. The nature of the work that needs to be undertaken that insurance under s 92 and s 94 of the Act is required.”

The builder’s submissions do not challenge the primary finding of the Tribunal at [89] of the Tribunal Decision.
As to Ground 12, it is plain that the challenge was confined to the issues of the application of Mann v Paterson and the contra proferentem rule. It was submitted:

“[63] The Tribunal’s acceptance that the contra proferent[e]m rule applies is misconceived as it is also misconceived by the Respondent. The decision in Mann v Paterson had nothing to do with contra proferent[e]m and only decided the upper limit of a builder’s claim under quantum meruit commensurate with the contract sum. This was canvassed at [29] – [30] of the Appellant’s Submissions in Reply.”

Paragraphs [29] and [30] of the builder’s submissions in reply are to the same effect:

“[29] The reliance by the respondent on Mann v Paterson Constructions Pty Ltd [2019] HCA 32 is difficult to understand and it is respectfully submitted that it is misconceived and the decision misunderstood. It has no bearing on the present matter.

[30] Mann v Paterson had nothing to do with the issue of contra proferent[e]m. The contract was not decided against the builder on a construction issue. The decision was a clarification of the upper limit of which damages on a claim based on quantum meruit can be made where there is a fixed price contract. Until the decision the prevailing view was that on an unlawful termination by the homeowner the builder would be entitled to make a quantum meruit claim at large and be able to obtain a windfall over and above the fixed price contract because the concept of quantum meruit was outside the contract. The decision simply set the upper limit of a quantum meruit claim to the contract price which would be consistent with the common law concept of damages not rewarding and innocent party. There was no issue of contra proferent[e]m and the court did not construe the contract "against the builder".”

The builder’s approach to Ground 12 accounts for the manner in which the Appeal Panel approached that ground.
As earlier set out in this judgment, the Appeal Panel first referred to the primary decision of the Tribunal at [89] of the Tribunal Decision in the summary provided at [40(2)] of the Appeal Panel Decision.
That issue is then only returned to in the course of dealing with Grounds 2, 3 and 4, as another basis for rejecting those grounds, before the Appeal Panel Decision squarely deals with Ground 12 at [87] – [90] as follows:

“[87] The contra pr[o]ferentum rule was not the subject of the High Court’s decision in Mann v Paterson, which decided that the upper limit of a builder’s claim under quantum meruit is commensurate with the contract sum.

[88] However, notwithstanding the Tribunal’s incorrect statement at [89] of the Substantive Decision as to what was decided in Mann v Paterson, this ground of appeal does not affect the outcome and [89] of the Substantive Decision was not part of the Tribunal’s dispositive reasoning.

[89] In fact, given that the Tribunal made no finding of ambiguity in the terms of Contract, the contra pr[o]ferentum rule, which may otherwise have applied, does not arise.

[90] The appeal in respect of this ground accordingly fails.”

Thus, Ground 12 was dismissed on the basis that, whilst error was demonstrated in the Tribunal Decision with respect to Mann v Paterson and the contra proferentem rule, that aspect of the Tribunal Decision was not dispositive.
The Tribunal Decision, in that respect, was not dispositive because the Tribunal did not find any ambiguity, but found that the contract was clear on its terms as to excluding the builder’s claim. Hence, it was unnecessary for the Appeal Panel to pass separately upon the construction of the contract, in this respect, because neither the ground of appeal nor the builder’s submissions agitated such a point. The Tribunal Decision was simply found to stand unchallenged (as was reflected in [60] of the Appeal Panel Decision).

THE SUPREME COURT PROCEEDINGS

Nature of appeal

By a Summons, the builder sought an appeal in relation to the decision of the Appeal Panel dated 29 November 2024, pursuant to s 83 of the NCAT Act.
In these proceedings, the parties confined the material before the Court to a Joint Court Book consisting of two volumes, which included written submissions. This Court also received a note titled ’Respondent’s Further Note’, provided to the Court on 18 September 2025 by the owner (“owner’s further note”) with two annexures.
The owner’s further note concerned the status of challenges to the Tribunal Decision or the Appeal Panel Decision or lack thereof as to the operation of the contract in precluding the builder’s claim. Despite being provided an opportunity to produce a note on this topic, the builder did not do so.

Appeal grounds and relief sought

The builder sought to appeal the Appeal Panel decision with respect of eight grounds, purported to be questions of law. Those grounds were as follows:

“Ground 1

1. The Appeal Panel erred in its conclusion at [81] that the challenge to the reasoning in Syed Ahmad Shoaib Au Pty Ltd v Jandson Pty Ltd [2018] NSWCATAP 228 about the meaning of “residential work” for the purposes of the Home Building Act (HBA) under ss 92 & 94 was wrong in that the Tribunal misdirected itself as to the nature of the decision in Lawrence v Ciantar (2019) NSWSC 464 and arrived at a mistaken conclusion.

2. The Appeal Panel erred in its related findings at AP [55, 67, 70, 75 and 79-81] that were informed by its answer with respect to the question whether the activities identified at AP [40(5)] (Activities) constituted residential building work for the purposes of HBA Schedule 1(2) read with sections 92 and 94.

Particulars

The Appeal Panel’s mistake includes, but is not limited to, its application of and reconciliation of the decisions in Lawrence v Ciantar (2019) NSWSC 464 and Syed Ahmad Shoaib Au Pty Ltd v Jandson Pty Ltd [2018] NSWCATAP 228.

Ground 2

3. The Appeal Panel:

(a) erred in concluding at [61] that the Builder was precluded from claiming damages under the contract because section 92(2) required a contract of insurance before any claim for damages was made;

(b) the wrong issue;

(c) asked the wrong question; and

(d) arrived at mistaken conclusion in its interpretation of the HBA.

4. The Appeal Panel erred in its related findings at AP [55], [60] & [61] with respect to the question whether, on its true construction, the prohibition in section 92(1) of the HBA applied to:

(a) conduct that was not residential building work for the purposes of the HBA, and so

(b) to the Activities.

Ground 3

5. The Appeal Panel erred in its related findings at AP [55] & [61] with respect to the question whether, on its true construction, the prohibition in section 92(2) of the HBA applied:

(a) to conduct that was not residential building work for the purposes of the HBA,

and/or

(b) to conduct that was not subject to the prohibition in section 92(1), and so

(c) to the Activities.

Ground 4

6. The Appeal Panel erred at AP [57] & [60] in concluding that the Builder’s claim for liquidated damages was a payment of part of the contract price; applied the wrong principle of law and identified the wrong principle of law and arrived at a mistaken conclusion.

7. The Appeal Panel erred in its related findings at AP [56], [61], & [71] with respect to the question as to whether payment of damages for breach of a contract is, for the purposes of section 92(2) of the HBA a payment under a contract to do residential building work.

Ground 5

8. The Appeal Panel erred in its related findings at AP [60], including by its construction of the relevant contract, with respect to the question as to whether, by not obtaining Home Warranty Insurance, per Part 6 of the HBA (HWI), the Builder did not, in the circumstances of its claim below, comply with its contract (Building Contract) with the Owner.

Ground 6

9. The Appeal Panel erred in concluding at [66] that HWI was necessary for a claim in in damages was necessary for a claim in damages where no “residential building work” requiring such insurance was undertaken;

the Appeal Panel identified the wrong issue, asked the wrong question and arrived at mistaken conclusion in its interpretation of the HBA.

10. The Appeal Panel erred in its related findings at AP [55], [64] & [66] with respect to the question whether, on its true construction, the prohibition in section 94 of the HBA applied:

(a) to conduct that was not residential building work for the purposes of the HBA,

(b) to conduct that was not subject to the prohibition in section 92(1), or

(c) to conduct that was not, by section 92(1) required to be subject of HWI, and so

(d) to the Activities.

Ground 7

11. The Appeal Panel erred in its related findings at AP [55] & [66] with respect to the question whether on its true construction, the prohibition in section 10 of the HBA applies to a case of a contract pursuant to which the only conduct undertaken was:

(a) conduct that was not residential building work for the purposes of the HBA, and/or

(b) conduct that was not subject to the prohibition in section 92(1), or

(c) conduct that was not, by section 92(1) required to be subject of HWI, and so

(d) to the Activities.

Ground 8

In the light of the errors addressed in grounds 1 to 7 herein, the Appeal Panel’s costs decision at AP [92]-[118] erred with respect to ordinary costs principles as to the question of what the appropriate orders for costs shall be reflecting the interests of justice.”

The Summons sought the following relief:

“1 Leave to appeal from the whole of the decision below.

2 Appeal allowed.

3 Judgment of 29 November 2024 (AP) of the Appeal Panel, being the court below, be set aside.

4 That appeals of the plaintiff, Champion Home Sales Pty Ltd (Builder) from the orders of the Tribunal for case no HB 2023/00382187 in its Substantive Decision made on 29 July 2024 and the Costs Decision made on 18 September 2024, are upheld, and those decisions be set aside.

5 That the defendant, Evonne Voulgaris (Owner) is to pay the Builder’s costs of:

a. These proceedings, and

b. Of the proceedings before the Appeal Panel and before the Tribunal on the ordinary basis, as agreed or assessed.

6 Such further and/or other orders as this Court sees fit.”

GROUND 5

Introduction

It is necessary to make some preliminary observations regarding Ground 5.
Mr Bennett was correct to submit that Ground 5 was the only ground of appeal concerning the construction of the contract.
The owner correctly submitted that Ground 1 concerned Syed. Ground 2 concerned s 92(1) of the HB Act. Ground 3 concerned s 92(2) of the HB Act. Ground 4 concerned the issue of the nature of liquidated damages and s 92(2). Ground 6 concerned s 94 of the HB Act. Ground 7 concerned s 10 of the HB Act. Ground 8 concerned costs. Each of those grounds (other than Ground 8) all had a common basis, that the Appeal Panel had misconstrued the definition of “residential building work”.
Ground 5 does not specifically address the Appeal Panel’s findings in relation to Ground 12 of the builder’s appeal to the Appeal Panel. That is, the Ground does not engage with the Appeal Panel’s reasoning at [87] – [90] of the Appeal Panel Decision, nor does the Ground or the builder’s submissions in relation to it adequately engage with the observations of the Appeal Panel at [60] of the Appeal Panel Decision, although Ground 5 does appear to recognise that the Appeal Panel’s remarks at [60] concerned the matters raised under Ground 4 of the current appeal by the use of the words “its related findings at AP [60]”.
However, as is apparent from the earlier discussion in this judgment, the following is the true context in which Ground 5 must be considered:
In the Tribunal Decision, the Tribunal decided that the builder was precluded under the contract from claiming the contract price because of a failure to take out warranty insurance (see the reference by the Appeal Panel to that effect at [40(2) and (4)] of the Appeal Panel Decision).
Paragraph [60] of the Appeal Panel Decision concerned Grounds 2, 3 and 4 of the appeal before it, which concerned liquidated damages.
Whilst the Appeal Panel confirmed (at [60]) the Tribunal Decision vis-à-vis the construction of the contract, it did so only as a further step in its reasoning to reject the appeal at Ground 2, 3 and 4 and without determining any ground of appeal challenging the Tribunal’s construction of the contract, namely, the builder being precluded from making any demands under the contract because the builder had failed to take out warranty insurance. In substance, the Appeal Panel had no appeal before it by the builder as to any finding that the contract, in and of itself, precluded the builder’s claim. As mentioned earlier, this accounts for the structure of the Appeal Panel Decision.
The Appeal Panel proceeded on the basis that the Tribunal had precluded the builder’s claim by virtue of the clear provisions of the contract. That approach was referrable to the summary of the Tribunal’s conclusions as set out at [40] of the Appeal Panel Decision and confirmed at [60] of the Appeal Panel Decision.

“HIS HONOUR: Can I come to this, which is a more direct question, and that is; did you say the contract, the building contract, provides for the carrying out of what has been, in one sense, described as preparatory work but, more particularly, that it operates on the various acts, tasks or works that are described in the statement of Mr Malesev that I was taken to earlier, from paragraph 22 to paragraph 31?

STOMO: We say it is not residential work ---

HIS HONOUR: I am dealing with the contract now.

STOMO: For the contract that has to be done, yes.”

This Court later turned directly to the question as to whether the contract itself precluded the builder’s claim. That lead to the following exchange:

“HIS HONOUR: The issue as to the operation of the contract itself, there are discussions about notations, et cetera, what ground does that relate to?

STOMO: It doesn't. It's a matter that my friend has raised and we say just ignore that.

HIS HONOUR: The appeal panel didn't pass upon that consideration at all?

STOMO: It did mention it and I have mentioned it in my written submissions. It made reference to certain clauses in the contract, although the clauses don't have the side notation, the ones that they have referenced. But I understand my friend's argument that there are side notes and other clauses and so forth.

Just as it came to thought in regard to schedule 6, there is just a notation, it is still just a note, but the section is blank. It is talking about statutory warranties and that is covered by clause 39, which is the statutory warranty which is implied in every contract.”

It is apparent from that exchange that what is suggested by counsel for the builder is that the question of the construction of the contract, and its capacity to bar the builder’s claim, did not arise on this appeal when expressed in that way.
It was in that light that provision was made for a note to be made by the builder and the owner, as to that question. As mentioned earlier, no note was received from the builder.
It has recently been observed in Lam v Liu [2025] NSWCA 254 (“Lam”) (per Free JA at [40] – [43] with Bell CJ and Payne JA agreeing) that “[i]n determining whether a party is raising a new issue on appeal it is necessary to look to the actual conduct of the proceedings”
Having reviewed the conduct of the Appeal Panel proceedings (and the Tribunal proceedings to which they related), I accept the submission made by counsel for the owner, in the owner’s further note, as follows:

“Whether [the contract] dated 23 June 20221 itself prohibits the [builder] from recovering any amounts from the [owner] was:

1.1. a live issue on the pleadings: Points of Defence at [25]-[29];

1.2. was a focus of the Tribunal’s First Instance Decision: at [18]-[21], [67]-[68], [75(a)], [86]-[90]; and

1.3. was not appealed to the Appeal Panel, though the Appeal Panel noted at J[40(2)] & J[40(4)] the issue, that the contract was fatal to the initial application.”

(footnotes omitted)

It was in this light that the owner made the following further submission:

“Where no challenge to the construction of the Building Contract was made before the Appeal Panel, the Appellant cannot now succeed on the further appeal, on questions of law only, before this Court: Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd )(no 2) [2025] NSWCA 210 at [55] per Adamson JA (Stern JA at [63] & Price AJA at [64] agreeing). This ground is dispositive of nothing, as even if the Court allowed it, the First Instance Decision at [18]-[21], [67]- [68], [75(a)], [86]-[90] is not impugned.”

In Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (No 2) [2025] NSWCA 210 (“Larsen”) Adamson JA (with whom Stern JA and Price AJA agreed) stated at [55]:

“In these circumstances, the respondents are bound by the way they put their case in the Courts below and ought not be permitted to depart from it: University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483 (Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ); [1985] HCA 28; Coulton v Holcombe (1986) 162 CLR 1 at 7-8 (Gibbs CJ, Wilson, Brennan and Dawson JJ); [1986] HCA 33; Whisprun at [51]; Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349 at [39] (Gageler CJ, Gordon, Edelman, Steward and Beech-Jones JJ). The limited exception to this fundamental principle is confined to matters of law which could not be affected by evidence (Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438 (Latham CJ, Williams and Fullagar JJ); [1950] HCA 35). The exception has no application in the present case.”

The construction of the contract is a question of law. The determination of the question does require a sub-stratum of facts for its determination, however, it is conceivable, at an abstract level, that the exception referred to in Larsen may apply.
However, the evidence as to the fact of the contract, the work undertaken by the builder, and the failure of the builder to take out warranty insurance (as pleaded as particulars in the Points of Defence by the owner before the Tribunal) were not contentious before the Tribunal or in any later proceeding, including the present proceedings. It is not evident what additional evidence could have been led bearing upon the question of whether the contract precluded the builder from recovering any amounts from the owner: Lam at [44] – [48] (per Free JA).
The owner is nonetheless correct to submit that, even if the appeal were allowed, the judgment of the Court would have no impact upon the Tribunal Decision vis-à-vis the operation of the contract. That consideration has wider implications.
Whilst the builder sought that his appeal from the orders of the Tribunal in the Tribunal Decision be “upheld”, and the Tribunal Decision be set aside, the leave to appeal in this Court was confined to a challenge to the Appeal Panel Decision.
As to the Tribunal Decision, there was:
No ground of appeal to the Appeal Panel in relation to the Tribunal’s construction of the contract or the Tribunal’s finding that the contract prohibited the builder’s claim.
The Appeal Panel’s view as to the corrections of the Tribunal Decision in that respect (at [60]) did not concern any ground of appeal directed to whether the contract did or did not prohibit the builder from recovering any amounts from the owner. Nor did it purport to be dispositive of that question. That is the effect of [89] of the Appeal Panel Decision.
The significance of these considerations is not only that the builder brings a new point not argued before the Appeal Panel, but it seeks to challenge findings which simply have not been made by the Appeal Panel. In substance, the builder’s challenge must be seen as a defacto challenge to the Tribunal Decision as to the operation of the contract vis-à-vis the builder’s claim, as there was no appeal in this respect to the Appeal Panel. There is certainly no appeal in that respect in the Summons.
These considerations raise, in my view, real questions concerning whether the Court should grant leave to appeal. However, I propose to approach that question after consideration of the issues which the parties sought to ventilate in relation to the construction of the contract.

Interpretation of the contract

Notwithstanding the deficiencies in the builder’s appeal, I propose to briefly pass upon the issues of interpretation of contract, ultimately reaching the conclusion, on any of these bases, that Ground 5 of the appeal should fail.
It is in that context that I will now turn to consider the submissions advanced by the parties under Ground 5.

Submissions of the parties

Submissions for the builder

The submissions for the builder were, in summary, as follows:
The Appeal Panel’s construction of the contract was erroneous. In this respect, the builder relied upon [60] of the Appeal Panel Decision.
In relation to the issue of Notations in the contract, and whether the builder’s requirement for insurance was a precondition:

(a) Because “there is a notation on the side that no moneys should be paid or demanded without warranty insurance does not convert the words to promissory status”. It was submitted that “the contract expressly disavows promissory status to such words”. The builder relied upon cl 1.2 contained in “Clause 1. Interpretation”, as well as the “General Conditions” of the contract, which I have set out earlier in this judgment. (b) “It was therefore impermissible for the Appeal Panel (and the Tribunal) to utilise these words to draw a conclusion in its argument at [60] of its decision.”

In oral submissions, Mr Stomo maintained that that the Notations, referenced in [60] of the Appeal Panel Decision, were in the nature of “marginal” or “side notes” and did not form part of the operative terms of the contract, because the “contract specifies [in] clause 1.2… that the marginal note is not to be taken into account”.
The clauses referenced in [60] of the Appeal Panel Decision do not specify that “none of the contract price can be claimed or retained by the builder without it having obtained home warranty insurance”.
Clause 3 of the contract is a reference to the owner’s obligations that the owner must pay money when money “becomes payable under the contract in the manner and at the times stated in the contract”.
Clause 38 of the contract reproduces the statutory requirement that the builder must insure:

(a) loss or damage against loss or damage to the building works in any goods and materials on the site relating to the building work against theft, fire, explosion, lightning, hail, storm and tempest, vandalism, civil commotion and earthquake; and (b) public liability for an amount of $10 million for any one claim.

The balance of cl 38 of the contract relates to procedural aspects about providing insurance.
Clause 39 of the contract reproduces the statutory warranties under s 18B of the HB Act.
None of the above clauses carries any side notations in the manner suggested by the Appeal Panel.
Attachment B, the “Consumer Building Guide”, which is a mandatory requirement under the HB Act, makes no reference to the builder being precluded from payment under the contract until the requisite insurance is in place.
Attachment B, the Checklist, which accompanied the contract, is also a statutory requirement and it contains the notation (“Checklist Notation 13”) that insurance under the HB Act must be provided “before the contractor commences working before the contractor can request to receive any payment”. However, the Checklist Notation 13 is a reference to insurance under Pt 6 or Pt 6B of the HB Act and is a reference to the insurance required to carry out “residential building work”.
The Appeal Panel erroneously attempted to reinforce its position with the following paragraph at [61], that it considered “[f]undamentally” that the builder’s claim could not succeed because the builder’s claim for liquidated damages was “a payment under a contract to do residential building work”. It was submitted that that notion was an erroneous construction of contract. In that respect, Mr Stomo stated in oral submissions:

“STOMO: The marginal notes I think we have canvassed enough and we will just have to follow up to see what happened with that. Our submission is that they don't form part of the particular contract. Also I might add when you go to I think it is at page 84 that my friend referred to where the schedule of check list for the owners and he made reference to item 13.

HIS HONOUR: He did, yes.

STOMO: This document is something that the regulation requires to put in all the contracts, but you will notice at 13, that my friend relies upon, a certificate of insurance except where the work is of a kind that does not require insurance. There is a distinction given within the regulations that even though you have got a contract for the construction of a house there are items that may not require insurance and we say the preliminary work is part of that.”

From the above exchange, it is apparent that the builder relied upon Checklist Notation 13 to say that the contract must be read in conjunction with the HB Act such that, a prohibition to make a claim for work under the contract unless warranty insurance has been obtained, is confined to “residential building work” for the purposes of the HB Act.
On 5 July 2025, the builder provided reply submissions before this appeal. In this respect, the builder submitted:
The contract terms bind the parties. There is nothing opportunistic in pursuing a right as submitted by the owner in her submissions.
The owner is relying on the decision of the Appeal Panel and has not engaged in the builder’s submissions.
The terms relied upon by the Appeal Panel and the owner do not assist the owner.

Submissions for the owner

The submissions for the owner, in summary, were as follows (excluding the submissions provided in the owner’s further note):
The builder’s bespoke contract is clear on its terms, and stated in at least five places, including immediately after the builder’s signature space, that none of the contract price can be claimed or retained by the builder, or that any payment of money can made by the owner, without the builder having obtained warranty insurance (which the builder did not obtain) and provided the certificate of insurance to owner (which the builder did not do).
The Notations are provisions of the contract.
Critically and independently of the HB Act, cl 3.1 of the contract (that contains the owner’s obligations) only obliges the owner to pay “the contract price and other money that becomes payable under this contract in the manner and at the times stated in this contract”, which is subject to the regime described in the paragraph immediately above.
The only relationship between the builder and the owner is via the contract. In that respect, Mr Bennett relied upon the Appeal Panel’s observation (at [58] of the Appeal Panel Decision) in making the following submission:

“… The only connection between the appellant and the respondent is this contract on this site. It doesn't have any dealings other than a contract before your Honour. The contract is [replete] with references to the inability of the builder to recover any amounts under the contract until an insurance warranty is in place.”

Ground 5 overlaps with Ground 4.
The builder’s submission on this ground demonstrates the builder’s opportunistic approach to the owner. The builder is content to prepare documents that represent one position, but, upon locking in the owner by signature, resiles from the representations and contends an automatic entitlement to over $75,000 for no consideration from the builder.
Further, as to the Notations forming part of the contract, Mr Bennett stated during the course of his submissions:

“BENNETT:…What we do say (while I have your Honour looking at the contract), the definition of "Building Works" in the contract says, "The building works to be ... this contract". This contract did two things. It didn't only provide for how the actual house would be built, that is, it comes into physical existence. It also provided for the obtaining of the development approval. In this state you can't just build something because you decide to. There is the approval process which is the inevitable integer in that process.

…

BENNETT: We say that they form part of the contract. My friend refers to the conditions saying in the notes, do not form part of the contract, but in my submission, your Honour, in circumstances where this is a standard contract as amended by the appellant and provided by the appellant to the home owners for their signing, the only interpretation of this contract, according to the usual reasonable person in their position taking into account matters known to both parties, is that these provisions form part of the contract, that is the notation. They are consistent, in our submission, with clause 38 and with, we say, they dovetail with clause 3.1, which I have addressed at paragraph 7 in my submissions….

…

BENNETT:…My friend refers to the conditions saying in the notes, do not form part of the contract, but in my submission, your Honour, in circumstances where this is a standard contract as amended by the appellant and provided by the appellant to the home owners for their signing, the only interpretation of this contract, according to the usual reasonable person in their position taking into account matters known to both parties, is that these provisions form part of the contract, that is the notation. They are consistent, in our submission, with clause 38 and with, we say, they dovetail with clause 3.1, which I have addressed at paragraph 7 in my submissions…

…

BENNETT:…the notations that I have extracted in our written submissions do form part of the contract. They are not side notes as I hope I have made the point earlier. They are clear and they go to the heart of the contract. They are not something that is tangential or unrelated to the parties.”

Further, as to the disposition of this ground (and in light the entirety of this appeal) the owner submitted:

“…If it is a binding contract and these clauses are not a complete answer to the case, your Honour would then move on the Home Building Act to see what, if any impact that has on these parties' dealings.”

The Court was referred to page 51 of the contract, which under the heading “Signatures”, contained the following entries:

“This contract is made between the owner and the builder.

The schedules form part of this contract.”

Mr Bennett then referred to Sch 6 of the contract and noted that the only provision contained in Sch 6 is a notation that confirms the requirement for insurance:

“NOTE: The builder must not carry out any building work or demand or receive any part of the contract price until warranty insurance is in force and the owner is provided with the certificate of insurance…”

Consideration: Ground 5

The contract was between the owner and the builder (see the statements in the Signature section).
The contract is defined as meaning the agreement between the builder and the owner set out in the “contract documents”, which include “general conditions, special conditions, the plans, the specifications and other documents specified in [Sch] 5”. The Schedules to the contract also form part of the contract (see the Signature section). These provisions constitute the terms of the contract.
Attachment A and Attachment B (the Checklist and the Consumer Building Guide) do not form part of the contract.
The contract price is defined in cl 1.1 of the general conditions to the contract as the amount stated in cl 2(a) of Sch 1. As stipulated in Sch 1, the contract price is $530,000. The builder claimed under cl 44.15 of the contact, a sum equivalent to 15% of the contract price (adjusted, as earlier discussed in various respects).
It is in cl 2(a) of Sch 1 that a Notation first appears, which for convenience I will set out again:

“Note: The Builder cannot demand or receive any of the contract price (including the deposit) until warranty insurance is in force and the owner is provided with a certificate of insurance.”

That Notation appears immediately after a warning concerning variations to the contract price and before, inter alia, the specification of the deposit, owner and builder details, the description of the site and “building period”.
An almost identical note appears immediately after the provision for signatures in the Signature section.
There is no reference to the Notations in the HB Act, but it does include a reference to “warranty insurance”. That expression is defined in cl 1.1 of the general conditions as “insurance under the Home Building Compensation Fund as referred to in the [HB Act]”.
Again, that definition does not import the provisions of Pt 6 of the HB Act, but directs that the contract of insurance must be taken under the Home Building Compensation Fund (see s 103B(1) of the HB Act).
Clause 2.1 of the general conditions of the contract provides that “the builder must carry out… building works in accordance with this contract”. Building works are defined in cl 1.1 of the general conditions as, inter alia, building works “carried out” in “accordance with this contract as shown in the contract documents.”
It was common ground that the “building works” carried out by the builder at the site fell within this definition.
Presumably, the “building works”, as earlier described in this judgment, is work the builder considered occurred prior to the physical commencement of works on the site, as the builder relied upon cl 44.15, which only operates in those circumstances.
The builder devoted considerably less attention to Ground 5 than other grounds and directed most attention to provisions of the Notations, as did the owner.
However, in my view, it is important to focus attention initially and substantially upon the provisions of cl 38.2.
This clause provided that the builder must have insurance in place “before” the builder commences any building works.
It is true that, as the builder submits, this provision does not expressly prohibit the builder from making a demand for payment in circumstances where the builder has not taken out warranty insurance, but the provision expressed, in my view, the clearest intention, entirely consistent with the Notations, that the builder was not to commence the work he did undertake at the site (which was part of the “building works” in the contract) without the requisite insurance.
Where the provisions of cl 38.2 gain even greater significance is when they are read together with the provisions of cl 3.1. Clause 3.1 refers to an obligation to pay “other money that becomes payable under this contract” (other than the contract price). This expression is wide enough to engulf a demand under cl 44.15 (and does not depend on whether moneys due under cl 44.15 constitute payment of the contract price). I will return to this question in considering Ground 4.

“However, we do not understand Dixon J to be saying in that passage that "a term imported by statute into the contract of employment" loses its statutory character and becomes incorporated in the contract as one of its terms. On the contrary, he recognises the distinction between an obligation originating in a statute and an obligation arising from a contract. In his view, the distinction was not of importance in that case, but it is crucial in the present one. No doubt there are terms which are incorporated by statute in contracts of a particular kind so that the ordinary remedies for breach of contract are available in relation to them (58). And apart from statute, a term may be implied by law as an incident of a particular class of contract (59), but we do not understand the appellants to be submitting that any such implication arises here. They rely upon the statutory force given to the award and say that, because the relationship between the parties is contractual, the provisions of the award - or at least some of them including cl 11(a) in this case - become terms of the contract enforceable by the use of contractual remedies as well as the remedies provided by statute.”

It was not suggested by the builder that an implication arose in the contract such that the definition of “residential building work” in the HB Act would be incorporated into the contract. Nor could such an implication properly arise. The Notations do not express dependence, for their operation, on the HB Act. It is not necessary to imply such a term from the HB Act for the reasonable and effective operation of the contract.

GROUND 4

Submissions for the builder

In Ground 4, the builder contended that the Appeal Panel erred (at [57] and [60] of the Appeal Panel Decision) in holding that the damages claim of $79,500 was part of the contract price.
The builder submitted that the Appeal Panel misconceived the nature of agreed damages. The "legal basis of what the amount of $79,500 is compensating" is cl 44.15 of the contract. To recover in an action for breach of contract damages more than nominal, those damages must be proved unless they are admitted. If they are admitted there is an end of it.
The builder made the following submissions, in this respect:
The Appeal Panel erred in equating damages with a "payment under the contract”. A formula used to calculate agreed damages is fundamentally different from a payment for work done under the contract. Damages are intended to compensate for loss and damage resulting from a breach of contract, not to pay for a contractual obligation.
Where a breach of contract occurs the party not in breach is entitled to recover damages. This right is implied by law unless the contract provides to the contrary.
Fundamentally, damages are compensatory, and the plaintiff has the onus of proving what loss and damage has been suffered by the breach. The damages do not relate to the payment of any obligation but are compensatory for the default.
A payment under the contract, on the other hand, is triggered by the fulfilment by a party of an obligation under the contract requiring the corresponding payment. A claim for damages, on the other hand, is triggered by the default of an obligation under the contract.
An agreed damages clause obviates the necessity of “proving” what is the fair and reasonable amount of compensation, either arising naturally from the breach or contemplated by the parties, and, in effect, not being too remote. It does this by fixing the amount of liquidated damages as agreed by the parties as being a fair and reasonable estimate of the possible loss and damage that may be suffered as a consequence of the breach
Mason & Wilson JJ in AMEV-UDC Finance v Austin (1986) 162 CLR 170; [1986] HCA 63 (“Austin”) at 193 expressed the proposition for agreed damages as one that instead of providing an award under the general law, an agreed damages clause will be allowed to give greater certainty by allowing the parties to determine more precisely their rights and liabilities, especially in situations where “loss may be difficult or impossible to quantify or, if quantifiable, may not be recoverable at common law”. Mason & Wilson JJ [3] laid out the contours of such claim, as follows (Austin at 193):

“Instead of pursuing a policy of restricting parties to the amount of damages which would be awarded under the general law or developing a new law of compensation for plaintiffs who seek to enforce a penalty clause, the courts should give the parties greater latitude to determine the terms of their contract. In the case of provisions for agreed compensation and, perhaps, provisions limiting liability, that latitude is mutually beneficial to the parties. It makes for greater certainty by allowing the parties to determine more precisely their rights and liabilities consequent upon breach or termination and thus enables them to provide for compensation in situations where loss may be difficult or impossible to quantify or, if quantifiable, may not be recoverable at common law. And they may do so in a way that avoids costly and time-consuming litigation.”

In Boucaut Bay Co Ltd v The Commonwealth (1927) 40 CLR 98 at 106, Isaacs ACJ put the proposition of liquidated damages in the following terms:

“To recover in an action for breach of contract damages more than nominal, those damages must be proved unless they are admitted. If they are admitted there is an end of it.”

Any such pre-assessment may be greater or less than what might be obtained under general law damages. That would not of itself invalidate the clause nor classify it as a penalty unless it bears a disproportionate assessment to a genuine estimate, with the onus being on the defendant to show it is a penalty.
Clauses 29 and 44.15 of the contract are agreed damages clauses calculated using a formula (namely, 15% of the contract price), as a genuine pre-estimate of the loss and damage which may be suffered by the builder. It represents a contractually agreed value of what the builder would otherwise be entitled to prove as general damages. The fact that it was referrable to the contract price does not make it a payment of the contract price, as appears to be the position taken by the Appeal Panel at [57] of the Appeal Panel Decision.
The proposition posed by the Appeal Panel at [57], that the formula “does not address adequately, or at all, the legal basis of what the amount of $79,500 is compensating to it, if that amount is not an entitlement arising under the contract” is the incorrect approach. The amount of $79,500 constitutes an agreed amount between the parties representing the loss and damage suffered upon an unlawful breach by the other party. The fact that it refers to the contract price does not, of itself, make it payable as part of the contract price.
The builder, as part of the pre-contractual process, received a tender fee in the sum of $15,000 which was to be credited towards the contract price upon entering into the contract. The contract was entered into and, therefore, the amount was credited towards the contract price under the contract. The tender fee was non-refundable, and its purpose was for the builder to proceed to do the preliminary work required by the contract in order to obtain development consent prior to proceeding to construction. Some work had been carried out, and the builder has made a claim for this work in its application before the Tribunal in the amount of $9,874.63. There is no claim for refund of the $15,000. Nor is there a challenge to the appropriateness of the monies expended by the builder.
The sum claimed by the builder takes into account damages and the amount spent, and from that it has deducted the amount of $15,000, effectively making a claim for damages in the sum of $74,374.63.
The builder would be double dipping in receiving and retaining the $15,000 and claiming damages. This would not be permissible either at law or under the contract.
In a matter consistent with the builder’s approach to reliance upon the HB Act as governing the construction of the contract, the builder submitted that insurance is not required until such time as work which satisfies the criteria of being “residential building work” is undertaken, as this is the natural meaning of the definition and concurs with the position taken by the Court of Appeal in Lawrence Appeal*.*
There was an unlawful termination by virtue of the owner’s repudiation of the contract. Those circumstances entitled the builder to damages. The value of damages in that event was expressly agreed.

“It can't possibly be part of the contract price notwithstanding the fact that there is that $15,000. That $15,000 had to be taken off the contract price otherwise we would be double dipping. We would be getting $15,000 plus damages so we can't double dip. That has to come off that particular amount and that's why there is a $15,000 reduction, not because we are talking about the contract price or money paid under the contract.”

Consideration: Ground 4

By this ground, the builder challenged the Appeal Panel Decision at [57] – [61] in holding that the damages claim by the builder was part of the contract price.
The Appeal Panel held, in essence, that the damages claim failed for three distinct reasons, as follows:
damages compensate for contract price;
the terms of the contract preclude recovery absent the building insurance; and
section 92(2) (and by implication, s 10) of the HB Act preclude recovery.
As to the second bases for rejecting the builder’s claim I observed in discussing Ground 5, that it was unnecessary, in order to resolve the question of whether the builder’s claim was precluded by the contract (given the builder’s failure to take out warranty insurance), to determine whether the builder’s claim concerned to contract price because of the operation of cll 38.2 and 3.1 (even though the Notations only operate with respect to the contract price).
I will return to the third bases in considering s 92(2) of the HB Act in the context of Grounds 1 and 2, 3 and 7 below, even though the determination of those grounds and the construction of s 92(2) is not necessary to determine the appeal.
For completeness, however, I deal with the first bases identified by the Appeal Panel in determining the damages claim by the builder was part of the contract price.
In this appeal, the builder properly accepted that damages are compensatory. No other bases have been identified by the builder as to what the agreed damages are compensating, other than the contract price. This is no doubt because that is the only conceivable bases upon which the builder may be compensated. As the Appeal Panel correctly points out, the only connection between the parties is the contract. The builder was not entitled to any payment from the owner except for the contract price for building the home. Further, the connection is evident by the builder’s acceptance that the $15,000 paid by the owner should be credited towards the contract price.
I agree with the submission of the owner that the authorities relied upon by the builder (which I have set out above) only establish the agreed damages, or a pre-estimate of damages, obviate the need to quantify. The inherent nature of the damages as compensatory is not altered by that approach.
It follows that Ground 4 should be rejected. The related consideration is that the Notations, to which I have referred above, do operate to prohibit the builder from making the claim in circumstances where the builder did not take out warranty insurance.

THE OPERATION OF SS 10, 92 AND 94 OF THE HB ACT AND GROUNDS 1 AND 2, 3 AND 7

Submissions for the builder

I shall refer to the entirety of the builder’s submissions corresponding to the heading above at the outset, divided by a summary of those submissions as to Ground 1, followed by Grounds 2, 3 and 7, and finally, Ground 6.

Ground 1

Ground 1 contends that the Appeal Panel erred at [81] (and related findings at [55], [67], [70], [75] & [79] – [80]) of the Appeal Panel Decision in agreeing with the reasoning in Syed (at [263] – [275] and [293]) about the meaning of “residential building work” under the HB Act for the purposes of ss 92 and 94 of the HB Act, on the basis that the decision in Lawrence v Ciantar [2019] NSWSC 464 (“Lawrence”) ought to have caused the Appeal Panel to arrive at a different conclusion.
The builder’s rather lengthy submission on this issue were as follows:
The builder discussed at length many authorities of the Tribunal, the Appeal Panel, this Court and the Court of Appeal. The builder submitted that a stream of decisions which the Appeal Panel adopted (most relevantly, Syed) are in error and inconsistent with Grygiel*,* Lawrence and Lawrence Appeal.
The Appeal Panel followed the decision in Syed which found that preparatory work in the construction of a residential dwelling was covered by the definition “residential building work” found in cl 2 of sch 1 of the HB Act.
The foundation of the Appeal Panel’s findings were the comments by Basten JA in Grygiel at [57], which the Appeal Panel in Syed acknowledged were obiter.
Mr Stomo made reference to Grygiel, stating: “[i]n Grygiel's case it was an attempt by the builder to join his solicitor as a party under the [HB Act] and the question in that case was whether or not the court, or the [T]ribunal, would have jurisdiction to hear a dispute of that nature where the builder is complaining that he entered into a contract as a result of bad advice."
The builder submitted that the Appeal Panel in Syed made the following conclusions as to the dicta of Basten JA (which were, in fact, not supported by the reasoning of Basten JA in Grygiel):

(a) Grygiel is “inconsistent” with the earlier decision of McClellan J in Woolfe v Alexander Sussman t/as Sussman Construction Consulting Services & Anor [2001] NSWSC 702 (“Woolfe”) at [18] which was followed by Provincial Homes v Doyle & Ors [2004] NSWSC 624 (“Provincial Homes”) and Collings Homes v Head & Ors [2002] NSWSC 1219 (“Collings”):

"[18] In my opinion, residential building work is, as the definition makes plain, confined to building work in pursuance of the physical construction or alteration of a dwelling. It does not extend to goods or services provided in the course of considering the feasibility of the redevelopment of a property or the means by which utilising suitable valuations and cash flow projections the redevelopment of property may be financed".

(b) Basten JA’s obiter comments “impliedly overrule” the earlier decisions (Syed at [260]). (c) The Appeal Panel did not consider itself bound to follow the earlier decisions (Syed at [260]) which “would otherwise be binding” on the Appeal Panel (Syed at [261]). (d) It concluded that the Appeal Panel was free to follow Basten JA (Syed at [270]). (e) The Appeal Panel in Syed considered that Basten JA had a “preferred” view on the question of “residential building work” in a general sense, rather than in the specific context of jurisdiction, and that Basten JA was referring to the definition under cl 2 of Schedule 1 of the HB Ac**t (Syed at [270]). (f) The preference by the Appeal Panel is based on the Appeal Panel’s view that Basten JA was referencing the definition to cl 2 of sch 1 of the HB A**ct and not in the widest sense pursuant to the question of jurisdiction under s 48A of the HB Act which relates to the definition of “the building claim” (Syed at [266]). (g) The purpose of the legislation being consumer protection, the wide and broader definition should be imported to the definition of “residential building work” in a definition of cl 2 of Sch 1 of the HB Act (Syed at [276]). (h) This definition thereby required to include “the building process” as being “residential building work” (Syed at [292] - [293]). (i) The Appeal Panel thereby concluded that all preparatory work, because it gives rise to a residential dwelling, is the subject to the HB Act, thereby requiring insurance pursuant to ss 92 and 94 of the HB Act (Syed at [293]) (j) In Syed*,* the Appeal Panel concluded that all preparatory work that ultimately leads to the construction of a residential dwelling is subject to the HB Act, including the requirement for insurance under ss 92 and 94 of the HB Act.

That error was identified by the Court of Appeal in Lawrence Appeal at [123] – [130].
Significantly, the Appeal Panel in Syed noted (at [260]) that they did not consider themselves bound by the earlier decisions because “their Honours’ consideration of the issue was part of the reasoning process on jurisdiction which is inconsistent with that in Grygiel.”
That is, on its own reasoning, the Appeal Panel acknowledged that all the reasoning process goes to the question of jurisdiction and not to the more specific requirement for warranty insurance for “residential building work” required under ss 92 and 94 of the HB A**ct.
Thus, the conclusion in Syed (at [262]) that the Tribunal is “free to follow Basten JA’s obiter observations as to the meaning of “residential building work”” by expanding it to ss 92 and 94, lacks support from Basten JA’s dicta.
The expansion of preliminary work to ss 92 and 94 of Basten’s JA dicta at [57] of Grygiel was based on nothing more than his Honour’s opening words that “on one view…” residential building work could have a wider meaning, was taken to be a direct reference to the definition of residential building work in cl 2 of Sch 1. However, Basten JA made no such finding nor connection. There can be no such inference in the passage at [57] and [58] of his Honour’s decision as noted by Bathurst CJ, which was limited to the question of jurisdiction.
The interpretation of and conclusion based on the comments of Basten JA made by the Appeal Panel in Syed as argued (and was argued before the Tribunal and on appeal) was misunderstood and misconstrued by the Appeal Panel. The Appeal Panel in the Appeal Panel Decision, by following that interpretation, fell into error.
There is simply no foundation to reject the builder’s proposition that Basten JA was dealing only with jurisdiction as to the meaning of the term “residential building work” in relation to the supply of building goods and services which has a wider ambit than the reference to “residential building works” in the context of ss 94 and 95 of the HB Act.
The Appeal Panel only asserts that it appears to be a contradictory proposition. The Appeal Panel in Syed (at [269]) says what Basten JA is describing is “two pathways to a finding of jurisdiction”. It then goes on (at [270]) to say that “Basten JA’s preferred view of the meaning of “residential building work” … should be preferred” but ignores the context that it is in relation to determining jurisdiction and does not say that it applies generally to all preliminary work. His Honour was clearly not thinking of the definition in terms of ss 92 and or 94 of the HB Act*,* which ae not even referenced in the decision.
The builder’s contention in Lawrence Appeal was that the terminology “involved in” meant that the work was required to be part of the actual construction of the dwelling (at [124]). The builder in the case before this Court adopts that contention.

“By contrast to the definition of “building goods or services”, the definition of “residential building work” uses the expression “work involved in the construction of a dwelling”.”

The Court of Appeal acknowledged that preparatory work may be included in the definition but the ultimate sentence in [128] of the Lawrence Appeal emphasises that it must require a closer connection with the construction of a dwelling than that required for the claim to fall within the definition of “building goods or services”.
On the normal reading of the Court of Appeal’s reasoning, that connection must be integral to construction, and it is the normal reading of Basten JA’s reasoning and also of the relevant sections of the HB Act. The normal reading of the sections does not lend to an expansive interpretation of the definition of “residential building work” as suggested by the Appeal Panel in Syed and adopted in the Appeal Panel Decision. This is consistent with decisions such as McClellan J in Woolfe at [18].
The Court of Appeal in Lawrence Appeal then considered the particular facts and said (at [129]):

“[129] Whilst the work in question in the present case – ‘(e)stablish the requirements as to any variation in the manhole in the 150 mm drain pipe’ – may be said to be work in connection with the proposed subdivision, in my opinion, such an investigation is too remote to fall within the definition of ‘residential building work’.”

The Appeal Panel wrongly decided that the preparatory or investigatory work in this case, such as liaising with the council and obtaining information regarding the site prior to commencing construction, was the close connection referred to in Lawrence Appeal (at [128]).
In Lawrence Appeal (at [129]) Bathurst CJ (in relation to Basten JA in Grygiel) makes clear Basten JA’s comments relate to jurisdiction. Had Basten JA intended to depart from the earlier decisions on the definition of “residential building work” by the Supreme Court, his Honour would have made that point in the judgment rather than preface his comments to jurisdiction. There is no room to infer what his Honour might have meant.
The Appeal Panel in the present matter misunderstood and misapplied what was said in Lawrence Appeal and relied on Syed to come to a wrong conclusion.
There is a difference between “building goods and services” and “residential building works”. The term "building goods and services" is by necessity much wider than "residential building work" which is the type of work that needs to be carried out by the goods or services supplied.
The contention that Biggs referred to in the owner’s submissions as being against the builder is incorrect and does not assist the owner, for the following reasons:

(a) There was no warranty insurance in Biggs. The issue did not arise in the decision or the argument in the case. (b) Paragraphs [10]-[11] in Biggs related to jurisdiction. (c) Under the agreed damages cl 44.15 (as in the case before this Court), agreed damages in the sum of 15% of the contract price were allowed at [87] and [107] in Biggs.

Grounds 2, 3 & 7

Grounds 2, 3 and 7 concern the Appeal Panel’s consideration of the statutory construction issues arising under the HB Act.
The builder sought to group grounds 2, 3 and 7 on the basis that there was an overlap between these grounds because of the nexus of the term under the HB Act for “residential building work”.
Excluding repetition with the builder’s submissions as to Ground 1 or repetition more generally, the builder’s submissions, in this respect, may be summarised as follows:
The interpretation placed on the definition by the Appeal Panel (adopting Syed) creates arbitrary difficulties. It is not, for example, uncommon for contracts to be entered into, but construction or work done to be delayed. An agreed damages clause, such as the one in place, would be effective if the owner terminated the contract before work could begin. The interpretation by the Appeal Panel that, in effect, if a contract is for residential building work, it is a contract that, because of that fact alone, is required to have warranty insurance, would deny the builder its right to claim damages. This would be contrary to basic contractual principles, and the HB Act does not abrogate these principles. It is not a contravention of the HB Act not to have insurance if you are not carrying out such construction work.
In Syed, the matters which the Appeal Panel considered to be preparatory work and subject to the definition of “residential building work” included the obtaining of a zoning certificate (s10.7(2) Certificate) and environmental requirements under BASIX.
The Appeal Panel erroneously followed the Appeal Panel decision of Syed, by saying that “[p]ertinently, investigative works were performed at the site in compliance with the DA for the owner's dwelling…” (Appeal Panel Decision at [80]).
Henry J in Lawrence took a different approach and looked at it from the perspective of accepting how Basten JA’s comments were interpreted in Syed and considered how necessary the actual work was involved in the overall construction rather than the connection to the actual construction. This is the approach that the Appeal Panel took in the Appeal Panel Decision. That approach results in an arbitrary distinction as to what is closely related or not to the actual construction.
Bathurst CJ’s comments in Lawrence Appeal clearly limit the concept of “residential building work” to the actual construction of a building. Neither the Appeal Panel nor the owner’s submissions in this matter address this issue, except to say that the Appeal Panel, and by extension, the decision in Syed were correct. His Honour’s comments on this point sensibly refined the question of “preparatory works” in the context of ss 92 and 94 of the to require a physical proximity to construction in order to give true expression to the consumer protection ethos of the (i.e. to protect the consumer from defective or incomplete building work, undertaken by a builder and/or its employees and contractors).

“[143] Works of a preparatory nature may come within the definition of residential building work under the Home Building Act if they are works in readiness or preliminary to residential building works: (Grygiel v Baine [2005] NSWCA 218 at[57] (Basten JA); Syed Ahmad Shoaib Ali Pty Ltd v Jandson Pty Ltd [2018] NSWCATAP 228 at [276]).

…

[145] The preparatory works described as part of item 3 and in item 4 however, are in a different category. Item 3 refers to “any other works that would not conflict with the issues of a construction certificate as described under council’s requirements” and item 4 states “establish the requirements as to any variations in the manhole and the 150mm drainpipe”. They appear, from their description, to be in readiness for, and causally connected to, the DA works - particularly item 4 which relate to drainage works. In addition, they are not items excluded by the definition of ‘residential building work’ in the Home Building Act.”

It was this proposition that was challenged successfully in Lawrence Appeal and led the Court of Appeal to pronounce that the term “residential building work” relates to the actual construction and not to preliminary work.
The purpose of the HB Act can still be fulfilled. The position in Syed that preconstruction work can be just as damaging, is difficult to accept in view of the fact that the damage can only occur at the time of construction. Plans may be erroneously drawn, and other investigative matters may be missed or misunderstood which could lead to compensable damage. Until then, however, no compensable damage can occur. It is this which the insurance is designed to cover.
The second reading speeches on the question of insurance point to the same conclusion, that it is the dwelling which is protected from faulty workmanship. The preliminary works are not subject to faulty workmanship.
Hansard records that in the Legislative Council of New South Wales of 19 October 2011, when introducing the amendments including insurance, the Hon Greg Pearce (Minister for Finance and Services) explained:

“As I mentioned earlier, statutory warranties protect homeowners from incomplete and defective residential building work by requiring builders to warrant that their work will be done to a certain standard….

However, the home warranty insurance scheme warrants residential building work for six years for structural defects and two years for non-structural defects.

At present, "structural defect" is defined in clause 71 of the Home Building Regulation 2004. This definition provides that a structural defect is one that causes physical damage, or prevents, or is likely to prevent, the continued practical use of the building or any part of the building. Any component of the external walls or roof, including weatherproofing, is considered to be a structural element of the building. "Non-structural defects" are, by default, anything that does not fall into the above definition.”

The emphasis of insurance in the legislation defines it as such for the protection of the homeowner for faulty workmanship, as it is that aspect of the work which causes damage which needs to be corrected. This is consistent with the earlier Supreme Court decisions of Collings, Provincial Homes, Woolfe and Lawrence Appeal that “residential building works” is limited to the actual construction phase of the building works.
The setting of formwork or digging trenches is work which can be done incorrectly and require immediate rectification. This is work that is preparatory work in construction and “may” be considered “residential building work” simply because it is part of the construction in most cases, if not all (Lawrence Appeal at [128]).
The builder’s claim, however, is a building claim because it is in the course of supply of work which will lead to the construction of a dwelling, and, upon the commencement of construction, warranty insurance will be required and is thus a supply in connection to that end.
However, accordingly in the present case, no construction work having been carried out, there was no need for warranty insurance to be taken out, and no such requirement is required to fulfil the purpose of the HB Act.
There is therefore no contravention of the HB Act to prohibit a claim for damages pursuant to section 10 of the HB A**ct, and neither ss 92 and 94 of the HB Act (or in combination) prevents the builder’s claim as found by the Appeal Panel at [70] - [71] of the Appeal Panel Decision.

Ground 6

The builder’s submissions as to Ground 6 were as follows:

“[131] The conclusions drawn at [66] of the Appeal Panel decision cannot be maintained in light of the submissions above.

[132] The argument at [66] relies on identifying the contravention of the Act as its foundation.

[133] No contravention has taken place because no work requiring insurance has taken place as what is required to be insured must be “residential building work”. The earlier decisions of the Supreme Court in Collings, Provincial Homes, Woolfe and the subsequent Court of Appeal in Lawrence Appeal all have described such work as relating to the actual physical construction of the dwelling; the latter decision directly contradicting the reasoning in Sayed.

[134] It is agreed that no such work has taken place and thus there has been no contravention of the Act to deny the claim.”

Consideration: the operation of ss 10, 92 and 94 of the hb act and grounds 1; 2, 3 and 7 and 6

In essence, the builder contended that, on the true construction of s 92(2) of the HB Act, the Appeal Panel erred in finding that the builder was precluded from claiming damages under the contract because of the prohibition in that provision. The premise for that contention was that that the building works did not fall within the definition of “residential building work” in cl 2 of Sch 1 of the HB Act.
Section 10 of the HB Act precludes, inter alia, the builder recovering any remedy, including damages, if a provision of the H**B Act is breached (s 10(1)(c)). In that event, the builder “is not entitled to damages or to enforce any other remedy in respect of a breach of contract committed by any other party to the contract, and the contract is unenforceable by the person who contracted to do the work” (s 10(1)). Thus, if there is any breach of the HB Act, namely, in this case, if there is a breach of s 92(2), the builder is so precluded from making any claim under the contract, whether or not the claimed amount is part of the contract price, or a damages claim.
In Field v Dettman [2013] NSWCA 147, Preston CJ of LEC (with whom Beazley P and Meagher JA agreed) described the work done by s 92(2) of the HB Act as follows (at [43]):

“… It is a statutory prohibition on specified conduct (demanding or receiving payment under a contract for residential building work) directed to a specified person (the person so demanding and receiving payment) in specified circumstances (where there is failure to comply with the requirements in s 92(2) regarding a contract of insurance and a certificate of insurance in respect of the residential building work).”

His Honour expanded on that description together with a discussion of the operation of s 92(1) of the HB Act as follows (at [47]):

“Subsection (2) prohibits a person who does uninsured residential building work demanding or receiving payment for it. This prescribed conduct does not directly protect persons from the peril of having uninsured residential building work; rather, it operates to prevent a person who does uninsured residential building work from being able to benefit financially by demanding or receiving payment for such work. Such a prohibition may have an indirect effect of encouraging persons to observe the prohibition in subsection (1) on doing residential building work without a contract and certificate of insurance in relation to the work, so that they can be paid for their work.”

As the owner pointed out, s 92(2) of the HB Act operates so as to prevent, inter alia, a demand for “a payment under a contract for residential building work”. The provision applies whether or not work under the contract has commenced.
Section 94(1) of the HB Act is expressed differently. Under that provision, if a contract of insurance required by s 92 is not in force, in the name of the person who contracted to do the work, in relation to any residential building work, under a contract, the contractor who did the work is not entitled to, inter alia, damages.
Hence, s 94 of the HB Act operates only in circumstances where the contractor who actually did “residential building work” was uninsured. In that case, the contractor was not entitled to damages. In contrast, s 92(2) relates to a demand under “a contract for residential building work”, irrespective of whether work is undertaken.
The expression “residential building work” is defined in cl 2(1) of Sch 1 of the HB Act. The provisions of cl 2 of Sch 1 are as follows:

2 Definition of "residential building work"

(1) In this Act, residential building work means any work involved in, or involved in co-ordinating or supervising any work involved in--

(a) the construction of a dwelling, or

(b) the making of alterations or additions to a dwelling, or

(c) the repairing, renovation, decoration or protective treatment of a dwelling.

(2) Each of the following is included in the definition of residential building work --

(a) roof plumbing work done in connection with a dwelling,

(b) specialist work done in connection with a dwelling,

(c) work concerned in installing in a dwelling any fixture or fixed apparatus that is designed for the heating or cooling of water, food or the atmosphere or for air ventilation or the filtration of water in a swimming pool or spa (or in adding to, altering or repairing any such installation).

(3) Each of the following is excluded from the definition of residential building work --

(a) any work (other than specialist work) the reasonable market cost of the labour and materials involved in which does not exceed the amount prescribed by the regulations,

(b) any work (other than specialist work) involved in the manufacturing of a moveable dwelling, within the meaning of the Local Government Act 1993 (other than a moveable dwelling that is a manufactured home within the meaning of that Act),

(c) any work involved in the manufacture, assembly or erection of a moveable dwelling that is a manufactured home within the meaning of the Local Government Act 1993 , other than--

(i) specialist work, or

(ii) work involving the connecting together on the site on which the manufactured home is installed of its major sections and any associated structures forming part of the manufactured home and attaching them to footings,

(d) any work (other than specialist work) involved in the site preparation for, or the assembling or erection on site of, a moveable dwelling excluded by paragraph (b), unless the work requires development consent,

(e) any work referred to in paragraph (d) done in relation to land on which a council has authorised a moveable dwelling to be placed by issuing an approval under the Local Government Act 1993, whether or not a development consent is also required,

(f) any work that would otherwise be residential building work but that by or under another Act a person is prohibited from doing unless the person is the holder of a contractor licence or another authority under that other Act, but subject to subclause (4),

(g) internal painting work, but subject to subclause (5),

(h) any work (other than specialist work) done in relation to the removal and transport of a dwelling, but subject to subclause (6),

(i) the supervision only of residential building work--

(i) by a person registered as an architect under the Architects Act 2003, or

(ii) by a person supervising owner-builder work for no reward or other consideration, or

(iii) by any other person, if all the residential building work is being done or supervised by the holder of a contractor licence authorising its holder to contract to do that work,

(j) demolition work,

(k) any work involved in the installation of any material that forms an upper layer or wearing surface of a floor (even if installed as a fixture) and that does not involve any structural changes to the floor, but not including work involved in the installation of floor tiles unless the regulations otherwise provide,

(l) any work that involves the installation or maintenance of any fixed apparatus such as a lift, an escalator, an inclinator or a garage door by means of which persons or things are raised or lowered or moved in some direction that is restricted by fixed guides.

(4) Work referred to in subclause (3)(f) is not excluded from the definition of residential building work if it is part only of the work to be done under a contract to do residential building work.

(5) Internal painting work is not excluded from the definition of residential building work (under subclause (3)(g)) if it is part only of the work to be done under a contract to do residential building work.

(6) Work referred to in subclause (3)(h) is not excluded from the definition of residential building work if it is part only of the work to be done under a contract to do residential building work at the new site of the dwelling (whether or not that work is done under the same contract as the contract to remove and transport the dwelling).

(7) The regulations may--

(a) declare any work to be included in the definition of residential building work, or

(b) declare any work to be excluded from the definition of residential building work.

That definition was considered in Lawrence Appeal. Particular consideration was given to the words “involved in” in cl 2(1) of Sch 1, in the context of the particular work being undertaken in that matter.
In Lawrence Appeal (at [18]), Bathurst CJ referred to the terms of an agreement described in the judgment as the “November Agreement”. The relevant aspect of that agreement for present purposes was as follows:

“…6. The parties have agreed that the said works in the D/A as described in the sum of $435,000 that Wayne Lawrence shall proceed to carry out as described below prior to any major works described in the D/A.

Removal of the carport

Breezeway

Removal of surplus weeds and bushes in preparation of the construction certificate and any other works that would not conflict with the issue of a construction certificate as described under councils requirements.

Establish the requirements as to any variations in the manhole, and the 150mm drain pipe

Wayne Lawrence to provide the first of two checks [sic] of $10,000 payable to the 5 Angophora [C]rescent mortgage account at Suncorp bank…”

His Honour observed that the primary judge identified the issue before her to be as follows (Lawrence Appeal at [56]):

“56 …whether the agreement entered into by the parties was a contract under which the appellant undertook to do, by himself or others, “residential building work” as defined by the Home Building Act. She said that if the agreement was not caught by the Act (ie a contract for residential building work to which s 7BA applies) the issue for determination was whether it was validly terminated by the respondents.”

It should be noted, however, that Bathurst CJ focused on a particular aspect of the preparatory works, as did Henry J in Lawrence (see the summary of the findings of Henry J in the Lawrence Appeal in the extract of [73] below).
The relevant aspects of the primary judge’s decision in that respect were summarised by his Honour as follows (Lawrence Appeal at [71] – [73]):

“[71] The primary judge stated that she was satisfied that the driveway and the drainage works were to be constructed for use in conjunction with a dwelling within the meaning of the Home Building Act. The appellant accepted in the present appeal that if the November Agreement were read as requiring the appellant to carry out the whole of the Development Application works, it would be invalid pursuant to s 7D(1) of the Home Building Act.

[72] The primary judge also accepted the respondents’ submission that even if the appellant was only obliged to carry out the preparatory works, the contract was one which fell within the provisions of the Home Building Act. She stated that works of a preparatory nature may come within the definition of “residential building work” under the Home Building Act if they are works in readiness or preliminary to residential building work.

[73] The primary judge stated that the demolition of the carport and breezeway was specifically excluded from the Home Building Act by virtue of Sch 1 cl 2(3)(j). However she stated that preparatory work consisting of “any other works that would not conflict with the issue of a construction certificate as described under council’s requirements” and to “establish the requirements as to any variations in the manhole and the 150 mm drainpipe” appeared to be in readiness for, and causally connected to, the Development Application works.”

The grounds of appeal in the Lawrence Appeal referred to the above-mentioned issues identified by the primary judge. The relevant grounds of appeal for the purposes of this matter were grounds 7 and 8. Those grounds were as follows (Lawrence Appeal at [79]):

“No Breach of the HBA in the case of Preparatory Work

7 The Court below erred in finding that the 12 November Agreement was a contract in respect of residential building work for the purposes of the HBA (Judgment at [140]-[145]), to the extent that it required the appellant to carry out the ‘preparatory works’ (Judgment at [70]) consisting of:

a. removal of the carport;

b. [removal of the] breezeway;

c. removal of surplus weeds and bushes in preparation of the construction certificate and any other works that would not conflict with the issue of a construction certificate as described under councils requirements [sic];

d. [to] establish the requirements as to any variations in the manhole and the 150mm drain pipe;

e. to provide the first of two checks [sic] of $10,000.

8 The Court below should have found that, upon the proper construction of the HBA, the preparatory work was not ‘residential building work’ within the meaning of the HBA.”

In commencing a discussion of Ground 7 (and Ground 8), Bathurst CJ referred to Grygiel as follows (Lawrence Appeal at [123] – [127]):

“[123] In concluding that part of the preliminary work required by the November Agreement, namely, the establishment of “the requirements as to any variations in the manhole and the 150 mm drainpipe” fell within the definition of “residential building work”, the primary judge placed reliance on what was said by Basten JA in Grygiel v Baine [2005] NSWCA 218 (“Grygiel”) at [57]. As part of a discussion in that case of other definitions in the Home Building Act, Basten JA made the following remarks:

“It is not necessary to determine whether, in relation to the first limb of the definition, services can be supplied ‘for or in connection with’ the carrying out of residential building work, for the purposes of the definition of ‘building goods or services’, where no residential building is in fact carried out. On one view, the definition of ‘residential building work’ is not limited to activities, such as laying foundations and painting a building, on site, but extends to work of a preparatory nature. Alternatively, preparatory work could be said to have a sufficient connection with the carrying out of building work because its purpose was to give rise to residential building work and it had a sufficient causal nexus with such work ... Accordingly, it is at least arguable that project management arrangements, of the kind addressed in both Collings Homes cases, would fall within the definition of ‘building claim’. Were that not the case, distinctions would need to be drawn which might have an arbitrary result, at least from the perspective of the homeowner. Thus, where an architect or project manager provides plans and designs, locates a builder and coordinates and supervises the actual building work, any loss suffered as a result of inadequate coordination and supervision would fall within the building claim, but other conduct would not.”

[124] Senior counsel for the appellant submitted that the use of the words “involved in” in the definition of “residential building work” meant that the work was required to be part of the construction of the dwelling. He submitted that although the work the subject of the November Agreement might have a broad connection with the construction work undertaken, it did not form part of it.

[125] Senior counsel for the respondents referred to the width of the definition of “dwelling” in cl 3 of Sch 1 of the Home Building Act. She submitted that establishing the requirements as to the variation of the manhole and the drainage pipe constituted preparatory work for the construction of a dwelling, having regard to the inclusions of things such as driveways and drainage in the definition of “dwelling” in cl 3(2).

[126] In the passage from Grygiel cited by the primary judge, Basten JA was primarily dealing with the definition of “building goods or services” in s 48A of the Home Building Act. These services were relevantly defined in s 48A as “goods or services supplied for or in connection with the carrying out of residential building work …” Section 48A is contained in Pt 3A of the Home Building Act which deals with the resolution of building disputes.

[127] The issue in Grygiel was whether an advice in relation to a building contract fell within the definition of “building goods or services” such as to give the (then) Consumer, Trader and Tenancy Tribunal jurisdiction to resolve a claim for negligence against the solicitor in respect of the advice. The Court was thus concerned with the question of whether the provision of the advice was a service supplied for or in connection with the carrying out of what was admitted to be residential building work. That is clear from the paragraph of the judgment in Grygiel at [58] which immediately follows the passage cited by the primary judge:

“That is not to say that the jurisdiction of the Tribunal under the Home Building Act should be expanded beyond the proper construction of the terms used in Part 3A. The fact that the Tribunal has a jurisdiction under that Part up to $500,000, whereas its current jurisdiction under the Consumer Claims Act is limited to $25,000, demonstrates the need to maintain proper limits on the jurisdiction. Nevertheless, to the extent that the statutory terminology permits, those limits should not be arbitrary, nor should an unduly restrictive construction be given to the words of the statute, especially to the extent that they mirror the terminology of the Consumer Claims Act. Of particular concern would be a construction which meant that services of a project manager might fall within the definition of ‘building claim’ where residential building works actually eventuated, but not otherwise. Such a distinction can be avoided if the phrase ‘the carrying out of residential building work’ is treated as adjectival, in the sense that it is descriptive of the services with which a connection must be established, rather than being treated as a factual pre-condition to the necessary connection.””

I interpose to mention that paragraph [58] of the judgment of Basten JA in Grygiel was as follows:

“[58] That is not to say that the jurisdiction of the Tribunal under the Home Building Act should be expanded beyond the proper construction of the terms used in Part 3A. The fact that the Tribunal has a jurisdiction under that Part up to $500,000, whereas its current jurisdiction under the Consumer Claims Act is limited to $25,000, demonstrates the need to maintain proper limits on the jurisdiction. Nevertheless, to the extent that the statutory terminology permits, those limits should not be arbitrary, nor should an unduly restrictive construction be given to the words of the statute, especially to the extent that they mirror the terminology of the Consumer Claims Act. Of particular concern would be a construction which meant that services of a project manager might fall within the definition of “building claim” where residential building works actually eventuated, but not otherwise. Such a distinction can be avoided if the phrase “the carrying out of residential building work” is treated as adjectival, in the sense that it is descriptive of the services with which a connection must be established, rather than being treated as a factual pre-condition to the necessary connection.”

In the Lawrence Appeal (at [128]), Bathurst CJ drew a distinction between the definition of “building goods or services” and “residential building work”.
His Honour further observed (Lawrence Appeal at [128] – [130]) as follows:

“[128] By contrast to the definition of “building goods or services”, the definition of “residential building work” uses the expression “work involved in the construction of a dwelling”. That may include preparatory work such as laying foundations or otherwise preparing the site for construction (noting that demolition work is expressly excluded), but it does seem to me to require a closer connection with the construction of a dwelling than that required for a claim to fall within the definition of “building goods or services”.

[129] Whilst the work in question in the present case – “[e]stablish the requirements as to any variations in the manhole and the 150 mm drainpipe” – may be said to be work in connection with the proposed subdivision, in my opinion, such an investigation is too remote to fall within the definition of “residential building work”.

[130] It follows this ground of appeal has been made out.”

It is clear from the judgment of Bathurst CJ in Lawrence Appeal*,* and the judgment of Basten JA in Grygiel (at [57] and [58]), that preparatory work for building and construction may constitute “residential building work” for the purposes of s 92(2) and cl 2 of Sch 1 of the HB Act, although the words “involved in” or “involvement in coordinating or supervising any work involved in” in the definition of residential building work requires a “closer connection” with the construction of the dwelling than the requirement for a claim to fall within the definition of “building goods or services”. Nothing in the Bathurst CJ’s judgment in the Lawrence Appeal necessarily requires that any preparatory work for building must necessary include physical work on a building site.
In Lawrence Appeal, the “feasibility” investigations or the “looking at potential issues on site” did not have the requisite connection. However, in this case, the property was owned by the owner, and the preparatory works were directly linked to the proposed building works. The “building works” were necessary for the house to be built on the site and were directed to the achievement of that objective. As was found by both the Tribunal and the Appeal Panel, the building works were for the house the subject of the contract, and the builder was paid for those works.
In this matter, in my view, there is a sufficient connection between the “building works” (being preparatory in nature) and the carrying out of the work of actually constructing the dwelling on the site.
In my view, the “building works” involved residential building works for the purposes of cl 2 of Ach 1 of the HB Act. That approach is consistent with the principles enunciated in the judgment in the Lawrence Appeal, even though the facts and circumstances between the two cases are distinguishable.
Even if it were to be found that obtaining the DA in the context of the building works was not residential building work, the outcome in this case would, in my view, be no different – the prohibition in s 92(2) of the HB Act nonetheless applied.
That conclusion follows because, unlike s 94(1) of the HB Act, s 92(2) does not concern work, as such, being undertaken. The provisions of s 92(2) expressly eschew that the provision requires for its operation, that the building work is done.
Section 92(2) of the HB Act operates when a demand is made “under a contract for residential building”. There was no dispute in this matter that the contract was for residential building work and the building works, even though preparatory in nature, were caught by the contract.
Section 92(2) captures both claims for deposit “or other payment”. That latter expression is broad enough to encompass claims under the contract for either the contract price or damages.

CONCLUSION

The failure of the builder to challenge the Tribunal Decision that the contract unambiguously precluded the builder from making the builder’s claim when the builder had not taken out warranty insurance in the Appeal Panel proceedings results in the Tribunal Decision in that respect being undisturbed by the Appeal Panel Decision.
The present appeal does not address, and does not affect, the Tribunal Decision, in that respect. Nor, for the reasons I have given, may it have any consequence for the Appeal Panel Decision.
Ground 5 does not address the observations of the Appeal Panel confirmatory of the Tribunal Decision, namely, that the contract, by its terms, precluded the builder’s claim because the builder had not taken out insurance. Paragraph [60] of the Appeal Panel Decision recognised (and agrees with) the Tribunal Decision in that respect, but it is not dispositive of that question, as the Appeal Panel was not required to deal with that question (the Appeal Panel Decision concerned other grounds of appeal).
This is a compelling reason to refuse leave with respect to Ground 5. In any event, I have observed that the Tribunal Decision (as reflected in paras [40] and [60] of the Appeal Panel Decision) is correct. That conclusion may be sustained by the operation of cl 3.1 and 38.2 of the contract alone. However, in view of my rejection of Ground 4, the Notations (at least as to cl 2(a) of Sch 1 and Sch 6 of the contract) operated not only to buttress the conclusion deriving from cl 3.1 and 38.2 (on the basis that the contract must be read as a whole in ascertaining it true legal effect) but independently operated so as to preclude the builder’s claim.
The balance of the grounds of appeal concerning whether the HB Act precluded the builder’s claim are effectively rendered nugatory in that context because the prohibition in the builder’s claim would operate irrespective of the operation of the HB Act.
Nonetheless, I have given consideration, albeit compendiously, to the various grounds of appeal concerning the HB Act in so far as they concerned the interpretation of the words “residential building works” in ss 92(2), 94(1)(a), and cl 2 of Sch 1 of the HB Act. The builder made lengthy and often repetitive submissions challenging the Appeal Panel Decision so far as it concerned the construction of the HB Act and, more particularly, the construction of ss 10, 92 and 94 of the HB Act. Those submissions travel across grounds 1, 2, 3, 6 and 7*.* My analysis of them was dealt with as a group because the premise of the grounds was that the appeal panel had erred in its construction of s 92(2) of the HB Act and the definition of “residential building work” in cl 2 of Sch 1 of the HB Act. The Court has rejected those contentions.

ORDERS

The Court makes the following orders:
Leave to bring Ground 5 of the appeal is refused.
The appeal is otherwise dismissed.
In so far as judicial review was sought, the application is dismissed.
Champion Homes Sales Pty Ltd shall pay the costs of the appeal of Evonne Voulgaris as agreed or in default as assessed.

**********

Endnotes

I shall employ the expression “warranty insurance” to describe the form of insurance required under the contract (where the expression “warranty insurance” is used and defined under cl 1.1) or the form of contract of insurance required by s 92(2) of the HB Act. I note that the Tribunal used that expression. The Appeal Panel used a similar but different expression, namely “home warranty insurance”.

Ground 4 was addressed twice by the Appeal Panel.

While the builder attributed this quote to Deane J, that was incorrect.

Champion Homes Sales Pty Ltd v Voulgaris

At a glance

Court

Decision date

Before

Catchwords

Source

Email me a plain-English brief of this case

Catchwords

Judgment

JUDGMENT

FACTUAL BACKGROUND

ISSUES ON THIS APPEAL

The contract and the HB Act

The Contract

Relevant Provisions under the HB Act

RELEVANT PRINCIPLES REGARDING THE APPEAL

Principles regarding Leave under s 83 of the NCAT Act

Principles in relation to construction of contract

PROCEDURAL HISTORY

The tribunal proceedings and decision

The builder’s submissions

The owner’s submissions

The Tribunal Decision: the contract

The Tribunal Decision: the HB Act

THE APPEAL PANEL PROCEEDINGS AND DECISION

Grounds of appeal: introduction

The Appeal Panel Decision:

Grounds 2, 3 & 4 – Damages

Grounds 4 & 11- Interpretation of HB Act

Grounds 4, 5, 6 & 7 – Challenge to Syed v Jandson

Grounds 8 & 9 – Payment to builder under clause 5

Ground 10 – Decision in Biggs

Ground 12 - The contra preferentum rule and Mann v Paterson

THE SUPREME COURT PROCEEDINGS

Nature of appeal

Appeal grounds and relief sought

GROUND 5

Introduction

Interpretation of the contract

Submissions of the parties

Submissions for the builder

Submissions for the owner

Consideration: Ground 5

GROUND 4

Submissions for the builder

Consideration: Ground 4

THE OPERATION OF SS 10, 92 AND 94 OF THE HB ACT AND GROUNDS 1 AND 2, 3 AND 7

Submissions for the builder

Ground 1

Grounds 2, 3 & 7

Ground 6

Consideration: the operation of ss 10, 92 and 94 of the hb act and grounds 1; 2, 3 and 7 and 6

CONCLUSION

ORDERS

Endnotes

Parties

Legislation Cited (14)

Cases Cited (23)