Elenberg Fraser Pty Ltd (A.C.N. 081 961 855) (Under external administration)

East St Falls Pty Ltd v L.U Simon Builders Pty Ltd (Building and Property) [2024] VCAT 416

1. All allegations in the Third Amended Points of Claim of defects in roof plumbing, defects in relation to Stair 7 and defects relating to lot E 604 are struck out.
2. The applicants have leave to file and serve by 30 May 2024 Fourth Amended Points of Claim substantially in the in the form of pages 29 to 153 of exhibit AW-2 to the affidavit of Anthony James Pelham Wilkinson dated 24 October 2023 but excluding:
   1. Paragraph 8A(a) and the particulars given under that sub-paragraph (a);
   2. Particular B4 under paragraph 17;
   3. Particular E under paragraph 17;
   4. Particular J under paragraph 17;
   5. Paragraph 19A;
   6. Paragraph 19B;
   7. The words "the ACP" in paragraphs 20 and 21; and
   8. Items 14 (Stair 7) and 171-176 (lot E 604) in Schedule B.
3. By 30 June 2024 the applicants may file and serve any further expert reports on which they seek to rely.
4. Liberty to apply.
5. Costs reserved.

1. The applicants in this proceeding BP524/2019 ("the East proceeding") are East St Falls Pty Ltd ("East") and 48 other applicants.
2. These reasons are for a decision upon two interlocutory applications.
3. The first ("the East leave application") was filed by the applicants on 22 March 2023. By it, the applicants sought leave to amend further the Points of Claim, to join additional applicants and to file and serve further expert reports. The application to join additional applicants is no longer pursued. The East leave application has required a decision as to whether some of the proposed amendments would introduce building actions which are barred because of the effect of s 134 of the Building Act 1993 (Vic) ('Building Act'); and a decision as to whether, in the exercise of discretion, these and other proposed amendments should be allowed or refused.
4. The second interlocutory application is a cross-application by the respondent L.U. Simon Builders Pty Ltd ("LUS") dated 10 November 2023. That application has required a decision as to whether two existing claims should be struck out from the current Points of Claim.

1. LUS carried out building works within the Falls Creek Alpine Resort:
   1. upon land of which East is lessee ("the East building");
   2. upon land of which West St Falls Pty Ltd (West") is lessee ("the West building"); and
   3. upon Crown land, called the Gateway Area, of which Alpine Resorts Victoria ("ARV") is lessor and East and West are lessees.
2. East, other applicants who or which are East's sub-lessees, and ARV, have brought the East proceeding against LUS claiming damages for alleged defects in building works.
3. In another proceeding, BP864/2019 ("the West proceeding"), West, other applicants who or which are West's sub-lessees, and ARV, have also claimed damages from LUS for alleged defects in building works. There is an interlocutory application in the West proceeding which is identical in nature to the first in the East proceeding. Reasons for decision upon the interlocutory application in the West proceeding will be published separately.
4. In each proceeding, each applicant claims that within the meaning of the Domestic Building Contracts Act 1995 (Vic) that applicant is a "building owner" having the benefit of a builder's warranties as provided for under that Act, that LUS is in breach of those warranties, that building defects are the consequence of the breach of the warranties, and that the breach has caused it loss and damage.
5. Some of the amendments that are proposed in the East leave application better define the land upon which the building works were carried out.
   1. They define the land of which East is lessee as Crown Allotments 251A and 252, Section A, Parish of Darbalang, County of Bogong, and refer to those allotments as "CA 251A" and "CA252" respectively.
   2. They define the Gateway Area as the area adjacent to CA 251A denoted on a plan contained in a lease from the Falls Creek Alpine Resort Management Board to East that commenced on 1 April 2009.

1. I heard the interlocutory applications in the East proceeding on 1 February 2024. I began to hear the interlocutory applications in the West proceeding on 22 November 2023; that hearing resulted in an order in a discrete part of the West proceeding.[1] I completed the hearing of the interlocutory application in the West proceeding on 1 February 2024 together with the two in the East proceeding.
2. The East proceeding had begun on 26 March 2019 by the filing of East's application accompanied by Points of Claim.[2] By the Tribunal's leave there were Amended Points of Claim filed on 17 January 2020 and Further Amended Points of Claim filed on 21 May 2020. If leave to amend were to be given there would be Fourth Amended Points of Claim. A draft of the proposed Fourth Amended Points of Claim is part of exhibit "AW - 2" to an affidavit of the applicant's solicitor Anthony James Pelham Wilkinson dated 24 October 2023 in support of the East leave application. LUS filed several affidavits of its solicitor Marika Nactaria Michaloudakis in opposition.[3]
3. East and the other applicants in the East proceeding had filed written submissions dated 8 November 2023. Ms Crafti SC made additional oral submissions for the applicants. LUS had filed written submissions dated 2 May 2023 and 14 November 2023. Mr Twigg KC made additional oral submissions for LUS.
4. LUS opposes the East leave application to amend the Points of Claim further. It does so for two main reasons. The first reason is that it says that some of the proposed amendments would introduce building actions brought outside the time limits set in the Building Act for bringing a building action, so they should not be allowed. The second reason is that in the absence of an acceptable explanation for delay in making the East leave application and because of potential prejudice to LUS none of the proposed amendments should be allowed.
5. The proposed amendments that LUS maintains are time-barred are those which allege that:
   1. Aluminium composite panels in walls are combustible and defective;
   2. Timber cladding to walls is combustive and defective;
   3. Roof plumbing works are defective;
   4. There are defects in the building works done on land, known as the Gateway Area, of which ARV is the lessee.

THE BUILDING ACT

1. In s 129 of the Building Act "building action" is relevantly defined to mean an action for damages for loss or damage arising out of or concerning defective building work.
2. Section 134 of the Building Act provides:

134 Limitation on time when building action may be brought

(1) Despite any thing to the contrary in the Limitation of Actions Act 1958 or in any other Act or law, a building action cannot be brought more than 10 years after the date of issue of the occupancy permit in respect of the building work (whether or not the occupancy permit is subsequently cancelled or varied) or, if an occupancy permit is not issued, the date of issue under Part 4 of the certificate of final inspection of the building work.

(2) Despite subsection (1), a building action may be brought more than 10 years but less than 15 years after the date of issue of the occupancy permit in respect of the building work (whether or not the occupancy permit is subsequently cancelled or varied) or, if an occupancy permit is not issued, the date of issue under Part 4 of the certificate of final inspection of the building work if -

(a) the building action is a cladding building action; and

(b) the building action has become or becomes prohibited on or after 16 July 2019 but before 1 December 2023 by this section as in force at any time before the commencement of section 49A of the Building Amendment (Registration and Other Matters) Act 2021.

(3) in this section -

cladding building action means a building action in connection with, or otherwise related to, a product or material that is, or could be, a non-compliant or non-conforming external wall cladding product.

It is s 134(1), rather than s 134(2) and (3), which is of importance in the East proceeding.

1. The uncontradicted evidence of Ms Michaloudakis in her affidavit dated 2 December 2022 is that the following occupancy permits and certificates of final inspection were issued for the land of which East is lessee and for the Gateway Area:

(a) Occupancy Permit No. 13101OP1 dated 13 June 2008 (being for the East Building (Level 1 and 2 (including common and ancillary areas) and Tenancies ER1, ER2, ER3, ER4 and ER5));

(b) Certificate of Final Inspection No 13101F7b dated 13 June 2008 (being for the East Build (Tenancies ER6 and ER7));

(c) Certificate of Final Inspection No. 13101F7c dated 14 October 2008 (being for the East Building (Stair 7 - Level 1 and 2));

(d) Occupancy Permit No. 13101OP2 dated 27 March 2009 (being for the East Building (Level 1 Amenities/Undercroft/Part Common Areas and Level 2-6 Residents));

(e) Occupancy Permit No. 13101OP3 dated 27 March 2009 (being for the East Building (Level 1 Amenities/Undercroft/Part Common Areas and Level 2-6 Residents, excluding the Level 2 Day Spa));

Those occupancy permits and certificates of final inspection are within exhibit "MNM-1" to the affidavit.

1. The East proceeding was begun before the expiration of 10 years from the date of issue of the last of those occupancy permits. The East leave application was filed more than 10 years after that date.
2. Section 134A of the Building Act provides:

134A Limitation on time when plumbing action may be brought

Despite anything to a contrary in the Limitation of Actions Act 1958 or in any other Act or law, if a compliance certificate is issued in respect of plumbing work under Part 12A, an action (including a counter-claim) for damages for loss or damage arising out of or concerning any defects in the work cannot be brought more than 10 years after the date of issue of the certificate.

1. The uncontradicted evidence of Ms Michaloudakis in her affidavit dated 13 November 2023 is that the Plumbing Industry Compliance Certificate for roof plumbing work on the building on the land of which East is lessee was issued on 4 June 2008. The certificate is exhibit: MNM-27 to the affidavit.

1. The original Points of Claim did not allege any defects in aluminium composite panels. They said nothing at all about those panels.
2. The proposed amendments that relate to aluminium composite panels are as follows.

(i) Paragraph 7A, which alleges the Building Code of Australia's requirements for external walls to be non-combustible and for a building to be fire-resistant.

(ii) Paragraph 8A(a): that LUS carried out the works using aluminium composite panels.

(iii) Particular J beneath paragraph 17: that the works were defective because the panels were combustible and non-compliant with the Code.

(iv) The last sentence beneath paragraph 17: "Further particulars of the defects in the works (Defects) are set out in Schedule B".

(v) Paragraph 19A: that the panels were combustible, not fire-resistant, non-compliant with the Code, constituted an undue risk of fire spread via the façade of the building, and were not good or fit for the purpose of being used in the external walls of the building.

(vi) Paragraph 19B: the matters alleged in paragraph 19A amounted to a breach of the Domestic Building Contracts Act warranties and to a breach of the Code.

(vii) Paragraph 20: until the panels are rectified the applicants are not covered by a policy of insurance for any damage that results from defects in the panels.

(viii) Paragraph 21: loss and damage insofar as they result from the panels being defective.

1. The original Points of Claim, and the Third Amended Points of Claim dated 21 May 2023, contained a schedule headed "summary of defective works". Paragraph 3 of that schedule was headed "3. Timber cladding" and proceeded:

"(a) Construction details not followed.

(b) Gaps in timber cladding.

(c) Movement in timber cladding.

(d) Ineffective cappings/ flashings

(e) Incorrect fixing of cappings/ flashings."

1. The proposed amendments to the Points of Claim that relate to timber cladding are as follows.
   1. Paragraph 7A, which alleges the Building Code of Australia's requirements for external walls to be non-combustible and for a building to be fire-resistant.
   2. Paragraph 8A(b): that LUS carried out the works using external timber wall lining and internal timber framing ("Timber Cladding").
   3. Particular C beneath paragraph 17, with respect to timber cladding:

1. Construction details not followed in that 150 mm wide x 28 mm thick ship lap boards were specified but 90 mm wide x 19 mm thick floorboards were installed.

2. Gaps in the Timber Cladding.

3. Movement in the Timber Cladding.

4. Ineffective cappings/ flashings

5. Incorrect fixing of cappings/ flashings.

6. Horizontal untreated pine battens installed behind the Timber Cladding.

7. Timber Cladding was not sealed in its entirety prior to installation.

8. Timber Cladding was combustible and non-compliant with the requirements of the BCA,[4] as to which the applicants refer to paragraph 19C below.

1. The last sentence beneath paragraph 17: "Further particulars of the defects in the works ("Defects") are set out in Schedule B".
2. Paragraph 19C: that the timber cladding was combustible, not compliant with the Code, constituted an undue risk of fire spread via the façade of the building, and was not good or suitable or fit for the purpose of being used in the external walls of the building.
3. Paragraph 19D: the matters alleged in paragraph 19C amounted to a breach of the Domestic Building Contracts Act warranties and to a breach of the Code.
4. Paragraph 20: until the timber cladding is rectified the applicants are not covered by a policy of insurance for any damage that results from defects in the timber cladding.
5. Paragraph 21: loss and damage, insofar as they result from the timber cladding being defective.

1. Items 1, 2, 3, 4 and 5 in paragraph 24c above correspond to items in the schedule to the original Points of Claim as set out in paragraph 23 above, but items 6, 7 and 8 do not.

1. The proposed amendment that relates to roof plumbing is particular E beneath paragraph 17:

E. With respect to roof plumbing:

1. Water has and does leak through roofing into below lots

2. The roof, eaves, flashings and gutters were not installed in compliance with relevant and applicable Australian Plumbing Standards at the time of installation.

3. Non-compliant design.

1. Although I describe this as a proposed amendment, there was a roof-plumbing allegation in the original Points of Claim that there was leakage through roof valleys. The Third Amended Points of Claim dated 21 May 2020 refer to an attached Schedule of Defects to which I have not been able to gain access to see what is alleged about roof plumbing. LUS has sought an order striking out the roof plumbing claim, but I am not sure that there is anything to strike out. So I propose to assume that if there is nothing to strike out LUS is applying to have the above proposed amendment disallowed.

1. Alpine Resorts Victoria ("ARV") was established as a body corporate[5] by the Alpine Resorts (Management) Act 1997, as amended by the Alpine Resorts Legislation Amendment Act 2022. From the commencement day of the 2022 Act, which was 1 October 2022,[6]
   1. ARV became the successor in law of the Falls Creek Alpine Resort Management Board ("the Board");[7]
   2. ARV was taken to be the committee of management of Crown land in the Falls Creek Alpine Resort;[8]
   3. all property, rights and assets of the Board became property, rights and assets of ARV;[9] and
   4. ARV was substituted as a party to any proceeding pending in any court or tribunal to which the Board was a party immediately before the commencement day.[10]
2. The original Points of Claim in the East proceeding named the Board as an applicant, alleged that the Board had been appointed to be the committee of management of Crown allotment 251A, that by a lease commencing n 1 April 2009 it leased that land to East for a term of 70 years, that the Board was a "building owner" within the meaning of the Domestic Building Contracts Act, that building works upon that land were defective, that LUS had breached the warranties provided for under that Act, and that because of the breaches the applicants (including ARV) had suffered loss and damage.
3. By a Tribunal order of 23 May 2023 ARV was expressed to have been substituted as a party instead of the Board. As the legislation referred to above had already effected a substitution on 1 October 2022 of ARV instead of the Board, the order was no more than a procedural formality.
4. The proposed amendments to the Points of Claim that relate to ARV are as follows.
   1. Paragraph 2A, which records the transition from the Board to ARV as described in paragraph 28 above.
   2. Paragraph 11(f), which describes the "Gateway Area" in the way set out in paragraph 9(b) above).
   3. Paragraph 16A(d), which alleges that ARV is the "building owner" of the works carried out in the Gateway Area.
5. In its second written submission LUS had asserted that ARV had not previously made a claim for loss and damage as a building owner. As ARV is the successor in law of the Board, and as the Board in the original Points of Claim had alleged that it was a building owner and had suffered loss and damage, the assertion was incorrect.

1. The original Points of Claim had included a reference to the lease from the Board to East, described in paragraph 9(b) above. The lease had been for a term of 70 years commencing on 1 April 2009.
2. Paragraph 11A in the proposed Fourth Amended Points of Claim alleges a second lease, by the Board to East and to West, of CA 252 for a term of 70 years commencing on 14 May 2010. There was no reference to this second lease in the original Points of Claim. In one of the affidavits filed on LUS's behalf there was an assertion that the applicants are time-barred from relying on that second lease. The assertion was not repeated in the written submissions. So I have taken it to have been abandoned. The second lease does not give rise to any cause of action against LUS or any right to bring a building action against LUS. It relates only to the standing of the applicants as building owners to take proceedings against LUS.

1. I have listed all the proposed amendments which LUS has submitted are time-barred because of s 134 of the Building Act. I accept Ms Crafti's submission that all other proposed amendments are just a tidying-up and better expression of the basis upon which each applicant has standing to sue LUS and do not alter the nature of the claims made in the original Points of Claim or introduce any new claims.
2. The applicants have agreed to delete from the proposed Fourth Amended Points of Claim the particular B.4 beneath paragraph 17; "Lack of thermal break and or effective thermal break".

1. The response that the applicants make to LUS's submissions that some of the proposed amendments are time-barred is that they do not constitute building actions within the meaning of s 134 of the Building Act. Rather, the applicants submit, the alleged defects in question (in the aluminium composite panels, in the timber cladding, in roof plumbing and in the works at the Gateway Area) do no more than particularise the breaches of the builder's warranties alleged in the original Points of Claim; there is no new or different cause of action against LUS being put forward.
2. LUS submits that to ask whether a new or different cause of action is put forward is to ask the wrong question. The submission is that s 134(1) of the Building Act requires identification of the "building work" to which an occupancy permit or certificate of final inspection relates, and identification of the relevant permit or certificate. A legal proceeding that alleges a defect in that building work becomes a "building action", which cannot be brought more than 10 years after the date of the permit or certificate that was "in respect of" that building work. A decision of the Supreme Court of Victoria, Court of Appeal, in a case to which I shall refer as "Lendlease",[11] is authority for the propositions advanced in the submission, says LUS.
3. The applicants rely upon another authority: a decision of the Supreme Court of New South Wales, Court of Appeal, to which I shall refer as "Parkview",[12] made later than the decision in Lendlease. There is a conflict of authority between superior courts, the applicants say, which creates a doubt as to which is preferable; for that reason it would be appropriate to defer any consideration of the correctness of Lendlease to a final hearing of the proceeding when all the facts will have emerged, rather than for the issue to be decided at an interlocutory stage.
4. LUS's submission is consistent with decisions of the Tribunal[13] both before and after Lendlease, although one such decision[14] did allude to the possible need to reconsider the decision in Lendlease in the light of Parkview.
5. Leandlease involved an application for leave to join additional applicants and a cross-application to strike out parts of the Points of Claim because they had been time-barred. Building works had been completed in stages, and there had been four occupancy permits that operated cumulatively. On appeal, the main issue had been which occupancy permit was the one which began the 10-year limitation period prescribed in s 134(1) of the Building Act. If it was the last of the four, the last occupancy permit issued in respect of the entire building project, claims were not time-barred. But if it was an earlier occupancy permit that began the 10-year period, some of the claims made in the Points of Claim were time-barred and the application for joinder would fail because the claims sought to be made by the would-be additional applicants were time-barred.
6. The Court of Appeal in Lendlease decided that for the purposes of s 134(1) time began to run from that date that an occupancy permit was first issued in respect to the particular work alleged to have been defective, not any "final" occupancy permit. It emphasised the need to focus upon exactly what were the items of building work said to have been defective, and which occupancy permit was "in respect of" those items. Apparently, there was no difficulty in deciding which of the occupancy permits was applicable.
7. The losing party in Lendlease did not argue, as the applicants in this East proceeding have done, that claims for defects should be regarded as particulars of a cause of action in a proceeding begun within time. Both parties seem to have accepted that the issue was whether a "building action", in the form of a particular claim for defective work, had begun within a period of 10 years that had elapsed after the issue of an occupancy permit in respect of that work. The Court of Appeal was not unmindful, however, of the impact of s 134(1) upon causes of action. It observed that Parliament had placed a bar on tort claims (which may not become manifest until after 10 years) but had actually extended the time for bringing claims in contract.[15] So it regarded the question of whether the new allegation of defects in work reflected a new cause of action or the originals cause of action as being irrelevant to the concept of a "building action" for the purposes of s 134(1).
8. The issue in Parkview was also whether amendments sought to be made to the initiating court process against a builder and a developer were time-barred. As in Victoria, the New South Wales legislation provided for builder's warranties that were for the benefit of the building owner from time to time. But other legislation, the Civil Procedure Act of New South Wales, governed the making of an application to amend the originating process after the expiration of a relevant limitation period. It provided[16] that a court could grant leave to amend:

(c) to add or substitute a new cause of action, together with a claim for relief on the new cause of action, being a new cause of action that, in the court's opinion, arises from the same (or substantially the same) facts as those giving to an existing cause of action and claim for relief set out in the originating process.

So the legislation required a focus on the "cause of action" expressed in the originating process and whether the "new cause of action" arose from similar facts.

1. It was in that context that the Court of Appeal in Parkview made the statement which Ms Crafti cited in her submission: that "ordinarily, an amendment which does nothing more than introduce further departures from the building as promised will not give rise to a new cause of action which would otherwise have been out of time."[17]
2. I accept Mr Twigg's submission that there is no conflict between Lendlease and Parkview. The cases follow different statutory pathways. Parkview was cause-of-action focused because the statutory power to allow an amendment required a comparison of a cause of action, the facts alleged in the originating process and the acts alleged in the proposed amendment. The Building Act provision construed in Lendlease did not require any identification of a cause of action. It required a focus upon the particular defect in building work that is being alleged and the date of the issue of the occupancy permit (or certificate of final inspection) in respect of that item of building work.
3. If, contrary to the view I have expressed, there are grounds for a reconsideration of authority upon the construction of s 134(1) of the Building Act because of Parkview, any reconsideration must be by the Court of Appeal in Victoria, not by the Tribunal. The decision in Lendlease binds me. I follow it.
4. Accordingly, a determination of whether each proposed amendment is time-barred involves answers to the following questions.
   1. What is the particular defect in building work being alleged which, if the amendment were to be allowed, would constitute a "building action"?
   2. What is the date of issue of the occupancy permit (or certificate of final inspection) in respect to the particular item of building work?
   3. Is the East leave application made more than 10 years after the date of issue?
5. The ability to answer those questions depends upon an ability to identify which permit or certificate is "in respect of" which item of allegedly defective building work.

1. The last occupancy permits issued for the East building were dated 27 March 2009. The East leave application was made more than 10 years after that date. The proposed Further Amended Points of Claim allege defects in the aluminium composite panels that were not alleged in any previous version of the Points of Claim. The new claim for those defects is, on the authority of Lendlease, a "building action" within the meaning of s 134(1) of the Building Act, barred if begun more than 10 years after 27 March 2009.
2. Although the panels apparently are for the façade of the building, no party has alleged or argued that a claim of defects in the panels was a "cladding action" within the meaning of s 134(2) and (3) of the Building Act. Such an allegation or argument would not assist the applicants. The building action became prohibited, by reason of s 134(1), before 16 July 2019 (on 27 March 2019), so s 134(2) is not applicable.
3. It is clear beyond any possible argument that, to the extent that they include an allegation of defects in aluminium composite panels, the proposed Fourth Amended Points of Claim are time-barred and cannot be allowed.

1. When the applicants began the East proceeding on 26 March 2019 - the last day of a 10-year period from the date of the last occupancy permit for works in the East Building - and filed the original Points of Claim on the same date, the original Points of Claim included the first five items which are repeated in particular C beneath paragraph 17 of the proposed Further Amended Points of Claim, as set out in paragraph 24c of these reasons. The last three items in particular C are new.
2. To be able to be sure that an allegation of a defect in timber cladding - a building action - is time-barred, one would need to link the defect clearly to an occupancy permit earlier than 27 March 2009 and to one of the three items in particular C that was not included in the original Points of Claim. I have not been able to do that.
3. Schedule B to the proposed Further Amended Points of Claim purports to be a comprehensive table, in the form of a Scott Schedule, that lists every lot in the East building and every defect for which a claim is made. The first lot in the schedule, lot E 201, is as good an example as any. The ninth category of defect for lot E 201 relates to timber cladding:

Lot E201 - Timber cladding on External Boundary Walls

i. External timber cladding supplied is not in conformance with architectural specification, which required 150mm wide x 28mm thick dressed vertical shiplap cladding

ii. Cladding has moved, twisted peaked as well as become misaligned and or detached

iii. Bottom edges of cladding boards were not splayed or sealed

iv. Inadequate or not suitable fasteners for fixing the cladding to the battens

v. Horizontal untreated pine battens installed behind the cladding

vi. Timber cladding is combustible and not suitable or fit for purpose as an external wall

vii. As installed, the timber cladding is not fit for purpose

1. Items i to iv correspond clearly enough to items 1 to 5 in particular C beneath paragraph 17 of the proposed Further Amended Points of Claim which were included in the original Points of Claim, and items v, and vi and vii correspond to items 6, 7 and 8 of particular C, which were not included. But to which occupancy permit or certificate of final inspection do they relate?
2. The first occupancy permit was issued on 13 June 2008 for Levels 1 and 2 (including common and auxiliary areas) and Tenancies ER1, ER2, ER3, ER4 and ER5. I have not been told what "ER" means in that context.
3. The fifth and last occupancy permit was issued on 27 March 2009 (being for the East Building (Level 1 Amenities Undercroft/ Part Common Areas and Level 2-6 Residents, excluding the Level 2 day spa).
4. It is not absolutely clear, at least to me, whether it was the first permit or the fifth permit that covered lot E 201. If it was the fifth permit, items i - iv set out in paragraph 54 above constitute building actions that have begun within the 10-year limitation period. If it was any earlier permit, those building actions would not have begun in time.
5. The High Court of Australia[18] has sent a loud and clear warning of the risk attendant upon deciding issues such as these at the interlocutory stage:

We should, however, state in the plainest of terms that we regard it as undesirable that limitation questions of the kind under consideration should be decided in interlocutory proceedings in advance of the hearing of the action, except in the clearest of cases. Generally speaking, in such proceedings, insufficient is known of the damage sustained by the plaintiff and of the circumstance in which it was sustained to justify a confident answer to the question.

1. The first permit's description gives it the appearance of a wide application to levels 1 and 2 while the fifth permit appears to have a more specialised purpose. Without any more information available at the moment I would think that there is a strong probability that it is the first permit that is applicable to lot E 201. But a strong probability is not enough. Refusing a litigant leave to amend its case because the proposed amendment is time-barred is a serious thing to do. Unlike the aluminium composite panels claim which was "the clearest of cases", the timber cladding claim is not the clearest of cases.
2. There is another reason why I consider that, if any of the proposed Further Amended Points of Claim are allowed at all, it would be appropriate to defer until the final hearing of the proceeding the question whether the alleged timber cladding defects are time-barred. In the West proceeding the parties consented to an order made on 22 November 2023 that gave West leave to make amendments that included timber cladding defects. If the two proceedings are heard together, as they surely should be, there will be evidence led in the West proceeding about timber cladding; to allow the whole topic of allegedly defective timber cladding to be at large during the hearing is not likely to widen significantly the scope of the hearing or to increase significantly the number of witnesses.

1. As with the alleged timber cladding defects, I cannot tell whether the fifth and last occupancy permit relates to works in the Gateway Area, in which case there would be building actions begun in time, or whether an earlier permit relates to those works, in which case they would be time-barred. I cannot link any of the items in Schedule B to the Gateway Area. If the proposed amendments concerning the Gateway Area are allowed at all, the time-bar issue should be deferred to the final hearing.
2. I consider the claim by ARV in relation to the Gateway Area to have begun with the original Points of Claim, in which the Board was named as a party and made a claim for damages. The claim made was a mere shell, without whatever substance there was to it having been revealed, but that was enough. I accept Ms Crafti's submission that the claim was made in a way that resembled a bare claim made in a generally endorsed Writ filed for the purpose of preserving rights in the face of an approaching time-bar with the Statement of Claim not being delivered until later. It may seem odd that ARV could be regarded as having made a claim on 26 March 2019 in the original Points of Claim when it did not then exist, but this is the effect of the legislation, it seems to me. The right that the Board had to bring a proceeding on that date became ARV's right.[19]

1. On the evidence referred to in paragraph 20 above, it is absolutely clear that the defects "with respect to roof plumbing" alleged in particular E beneath paragraph 17 of the proposed Further Amended Points of Claim are time-barred because of the operation of s 134A of the Building Act. The compliance certificate for the roof plumbing was issued on 4 June 2008. The East proceeding did not begin until 26 March 2019, more than 10 years after the date of the certificate. For reasons given in paragraph 27 above it is unclear whether the appropriate course is to strike out a previously made claim or to disallow the purposed amendment about roof plumbing. For the avoidance of any doubt I shall do both.

1. In its cross-application LUS sought an order that claims made in East's Third Amended Points of Claim relating to "Stair 7" and "Lot E 604" be struck out as being "frivolous, misconceived and/or lacking in substance".
2. Neither the original Points of Claim nor the Third Amended Points of Claim specifically mention Stair 7 or lot E 604. Schedule B to the proposed Fourth Amended Points of Claim contains an item for Stair 7, item 14, and for lot E 604, items 171-176.
3. The uncontradicted evidence of Ms Michaloudakis is that lot E 604 is now owned by a person not named as an applicant. So any claim by any present applicant with respect to lot 604 is not maintainable, and it is too late for the current owner to become an applicant.
4. The relevant certificate of inspection for Stair 7 was issued on 14 October 2008. The certificate numbered 13101FC is part of exhibit MNM-1 to the affidavit of Ms Michaloudakis dated 2 December 2022. That evidence is uncontradicted. It establishes that the certificate was issued more than 10 years before the commencement of the East proceeding, so it is a building action that is time-barred by s 134 of the Building Act.
5. Again, just as with the roof plumbing, there is a question whether the appropriate order to make with respect to those two items is a striking-out from Points of Claim in which they are not mentioned specifically, or a disallowance of them where they appear in the schedule to the Fourth Amended Points of Claim. For avoidance of any doubt I shall do both.

1. In making an application for leave to file and serve a Fourth Amended Points of Claim the applicants are seeking an indulgence. The "guiding principle" for the determination of such an application is set out in a passage from a Supreme Court decision[20] cited in the applicant's written submissions.

The tribunal is not a court of pleading. Nonetheless, in determining the appropriate approach of the tribunal to proposed amendments of points of claim or points of defence, it is useful to bear in mind the principles which apply to applications for amendment to pleadings in courts of higher jurisdiction. In such cases, the guiding principle is that a court should permit amendments in order to enable the real questions in controversy between the parties to be determined upon a full hearing of the case at trial. A proposed amendment to a pleading will only be disallowed if it would be futile, in the sense that it would have been struck out if it had appeared in the original pleading. The power to strike out summarily an action, or a substantive cause of action, is exercised sparingly in courts of higher jurisdiction. It is only invoked where it is clear that the action, or the cause of action, is so untenable that it cannot possibly succeed.

1. In a later High Court decision, in a case I call Aon,[21] the plurality of the Justices pointed to the considerations which should be applied:[22]

An application for leave to amend a pleading should not be approached on the basis that a party is entitled to raise an arguable claim, subject to payment of costs by way of compensation. There is no such entitlement. All matters relevant to the exercise of the power to permit amendment should be weighed. The fact of substantial delay and wasted costs, the concerns of case management, will assume importance on an application for leave to amend.

In the same case, French CJ stated that undue delay, non-compliance with ordered timetables and potential waste of public resources "are to be regarded as both relevant and mandatory considerations"[23] upon an application for leave to amend a pleading.

1. In opposing generally the application for leave to amend, LUS has relied upon the evidence of delay in making and pursuing the application, the failure to comply with Tribunal orders and directions, the paucity of explanation for the delay, and an alleged prejudice that it would suffer if the application were to be allowed.

1. The East proceeding began on 26 March 2019. Further Amended Points of Claim were filed on 21 May 2020. The East leave application for the proposed Fourth Amended Points of Claim was not made until 22 March 2023. Its hearing did not begin until 23 November 2023.
2. East and the other applicants changed their solicitors in late 2022. Their present solicitor Mr Wilkinson obtained the previous solicitor's file on 31 October 2022. He has deposed to the need to get instructions from all applicants for making an application to amend the Points of Claim.
3. On 23 June 2023 the Tribunal granted leave to amend but required the applicants to file and serve amended Points of Claim by 29 September 2023. They did not comply with the order. In the meantime Mr Wilkinson obtained six further expert reports. He was able to serve LUS with a copy of each report on 10 October 2023. Three of the six reports were dated 2 October 2023 and one was dated 28 September 2023.
4. In paragraph 20 of his affidavit dated 22 March 2023 Mr Wilkinson stated:

I acknowledge that the applicant in each of the Proceedings have not complied with the Tribunal's order to file and serve an application for leave to file a Proposed 4APOC. As set out above, the applicants have been unable to do so in the time ordered because (a) of the change of solicitor and the need for my firm, together with new counsel, to receive the client file, read in, and form a view on the work needing to be undertaken (b) contact each of the sublessees to procure their consent and instructions.

1. The delay and failure to comply with order between 26 March 2019 and 31 October 2022, while the applicants' previous solicitors were acting for them, are virtually unexplained. The only evidence about them comes from Ms Michaloudakis, who in her affidavit[24] described communications between her office and the office of the previous solicitors in 2020, 2021 and 2022 which were her attempts to obtain more information about the claims being made.
2. When he took over the conduct of the East proceeding (and of the West proceeding) in late October 2022 Mr Wilkinson took on a heavy burden. `I consider he has given a satisfactory explanation for the delay between 31 October 2022 and 22 March 2023, and for the failure to comply with the order of 23 June 2023. The course he took, in obtaining further expert reports and briefing Counsel to re-draw the Points of Claim, has meant that LUS, although it still complains of inadequacy in them, has ended up with proposed Further Amended Points of Claim which are considerably more informative about the standing of the applicants and the defects that are being alleged than earlier iterations of the Points of Claim had been.
3. The unexplained delay between 26 March 2019 and 31 October 2022 is, as French CJ put it, a mandatory consideration, and it is one that weighs against the granting of leave. But it is not the only consideration, and it would be wrong to refuse leave for that reason without considering other relevant matters.

1. Although LUS has asserted repeatedly that the granting of leave would cause prejudice to it, there are only two pieces of direct evidence of possible prejudice. In her affidavit of 13 November 2023 Ms Michaloudakis deposes in paragraph 36 that the fire engineer engaged for the works was not engaged by LUS and that LUS may need to make a claim against the fire engineer, and in paragraph 56 that other contractors over the course of several years have undertaken works without LUS having been "invited to view the works undertaken and how they were done".
2. As to the first of those matters, there is no evidence of how the granting of leave to amend would adversely affect LUS's ability to join the fire engineer as a party to this proceeding or to begin a fresh proceeding against the fire engineer. As to the second of those matters, it seems to me to go towards an issue of how much weight should be given to the need to do the work and to the cost of the work, about which LUS had little ability to make a contemporaneous assessment, rather than towards any issue of prejudice arising from an amendment to the Points of Claim.
3. In the written submissions LUS alleges other prejudice. Its expert witness will need to reattend the ski resort and address defects that could have been inspected previously had they been claimed earlier. That is probably so. Costs have been wasted; however, an order for costs thrown away, if made, would meet that objection. The further delay in having the proceeding heard that would result from amendments being allowed would mean a higher assessment of any damages because the cost of rectification work is likely to increase over time. That is probably so, but it is because the law requires assessment to be made at the time of the trial; nothing about the East leave application alters that feature of litigation in a building case.
4. This is not a case where the passage of time is likely to affect the availability of essential witnesses or of documentary evidence. It is likely to depend upon the evidence of expert witnesses and the resolution of issues of law.
5. So I am not persuaded that the granting of leave would occasion such prejudice to LUS that the granting of leave should be refused.

1. The impact that the granting of leave would have upon public confidence in the legal system or the management of litigation by the Tribunal, so evident in the Aon case, are not evident in this proceeding. Aon was an extreme case where an application was made, some days into the trial of the proceeding, for leave to amend. The setting down of this proceeding for hearing is a long way off.
2. Except for those claims which I have determined to be time-barred building actions, I grant leave to file and serve the Further Amended Points of Claim. Of course LUS will be free to assert, in any Amended Points of Defence, that the claims for defects in the timber cladding and in work done in the Gateway Area are barred by virtue of s 134 of the Building Act. All matters of controversy between the parties can then be determined at a full hearing of the East proceeding.

1. I see no reason why the applicants should not be permitted to file and serve any additional expert reports on which they seek to rely. Obviously it would be futile to file and serve reports about defects that were the subject of those parts of the proposed Fourth Amended Points of Claim that I have disallowed.

Traverse Alpine Developments Pty Ltd (ACN: 152 793 256) (removed by order dated 23/05/23)

Alan Norman Ford & Christine Elizabeth Ford ATF Alan N Ford Superannuation Fund (removed by order dated 23/05/23)

Tonks Superannuation Pty Ltd ATF Tonks Family Superannuation Fund

Eilan Donan Pty Ltd (removed by order dated 23/05/23)

Maria Susanne Devlin (removed by order dated 23/05/23)

Moedski Pty Ltd ATF The Bellmoed Family Trust (removed by order dated 23/05/23)

Matthew Gregory Salisbury (removed by order dated 23/05/23)

Paul Poli & Oliver Nikolovski (removed by order dated 23/05/23)

Lochlee Pty Ltd ATF D B McKay Family Trust (removed by order dated 23/05/23)

NYTW Pty Ltd ATF The Zhao & Liu Family Trust (removed by order dated 23/05/23)

Patrick Management Pty Ltd ATF The Patrick Tonkin Superannuation Fund

Dr Heather Webber (removed by order dated 23/05/23) & Heathbren Pty Ltd

Merri Bridge Pty Ltd (removed by order dated 23/05/23)

Mount Carli Pty Ltd, Rosalina Acance Jnr & Lea Acance

Patrick Jean-Christophe Charles Laplagne & Virginia Gai Williamson

Jeffrey John Lahnor & Sharon Elizabeth Lahnor (removed by order dated 23/05/23)

Fallons Superannuation Nominees Pty Ltd (ACN 094 452 703)

[1] I made the order on 23 November 2023, in terms to which the applicants and LUS had consented. They submitted minutes of a consent order. By an administrative error the minutes produced a consent order dated 27 November 2023 made by Member F Marks.

[2] The parties argued the application on the footing that the proceeding had begun on 25 March 2019. The Tribunal's file shows, however, that the filing fee was paid on 26 March 2019.

[3] The affidavits are dated 2 December 2022, 27 March 2023, 1 May 2023 and 13 November 2023 respectively.

[6] The 2022 Act, s 2(i); Special Gazette (No 371) dated 26 July 2022.

[11] Lendlease Engineering Pty Ltd v Owners Corporation No 1 PS526704E [2022] VSCA 105.

[12] Parkview Constructions Pty Ltd v The Owners - Strata Plan No 90018 [2023] NSWCA 66.

[13] Owners Corporation PS No. 1 PS 519798G v May [2016] VCAT 399; Vincentis v SDJ Property Fifth Pty Ltd [2022] VCAT 29; Singleton v East Gippsland Building Permits Pty Ltd [2023] VCAT 943.

[14] Singleton v East Gippsland Building Permits Pty Ltd [2023] VCAT 943 at [54].

[16] Civil Procedure Act 2005 (NSW) s 64(2)(c).

[18] Wardley Australia Ltd v Western Australia [1992] HCA 55; (1992) 175 CLR 514 at 533.

[19] See Paragraph 28 above and footnotes 5-10.

[20] Makrenos v Papaioannou [2008] VSC 83 at [10].

[21] Aon Risk Services Australia Ltd v Australian National University [2009] HCA 27; (2009) 239 CLR 175.

[24] Affidavit of 2 December 2022 paragraph 29 which summarises an affidavit of Teneile Jade Lambe dated 1 June 2022.