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[2001] VCAT 40
respondent. Application for an extension of time to appeal dismissed; costs reserved.
The builder applied to VCAT for an extension of time to appeal a decision by the Housing Guarantee Fund finding the builder liable for foundation rectification costs. VCAT held s126 allows extensions except where extension would cause prejudice or detriment that cannot be remedied by costs. The Tribunal found the builder delayed, sought to negotiate rather than appeal, and that the owner's position had suffered continuing detriment (including risk that rectification costs would exceed the scheme cap). Because that detriment could not be remedied solely by costs, VCAT lacked power to grant an extension and dismissed the application. Costs were reserved.
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1,795 words · generated 11/07/2026
Grandville Homes Pty Ltd (the builder) sought an extension of time to bring an appeal to VCAT against a decision made by the Housing Guarantee Fund Ltd (HGF) that the builder was liable for the cost of rectifying foundation movement at a dwelling owned by Beverley Haining. HGF inspected the property, concluded a defect existed, and notified the builder on 10 April 2000, providing a schedule of works to be completed by 10 May 2000 and advising of the right to appeal to VCAT within the statutory time limit (the builder had 28 days under s16 of the Housing Contracts Guarantee Act 1987) [7], [16]. HGF granted an extension to 26 May 2000 for the rectification work after a written request from the builder [8]. The builder thereafter corresponded denying liability (letters dated 17 July and 2 August 2000) rather than commencing an appeal; HGF later demanded payment ($44,000 plus GST) on 16 November 2000 [9-11]. The builder filed an application to VCAT on 29 November 2000 seeking an extension of time to appeal. Judge Davey, sitting in the Domestic Building List, dismissed the application for extension and reserved costs [1; Decision].
3 cited instruments linked from this judgment.
VCAT's decision turned on the operation of s126 of the VCAT Act 1998, which permits the Tribunal to extend time but contains a statutory bar: the Tribunal may not extend time if doing so "would cause any prejudice or detriment to a party or potential party that cannot be remedied by an appropriate order for costs or damages" [2], [21]. The Tribunal found the builder had "sat on its rights" and that the owner had suffered detriment that could not be adequately remedied by an order for costs or damages, given that the rectification claim already stood at the limit of the housing guarantee scheme and that continuing damage had been evidenced [28-30]. Accordingly the Tribunal concluded it was deprived of jurisdiction under s126 to grant an extension and dismissed the application [31-33].
Two legal axes govern the decision.
First, statutory constraint: s126 of the VCAT Act confers a broad discretion to extend time, but gives the Tribunal no power to extend time where the extension would cause unremediable prejudice or detriment to a party or potential party (the jurisdictional bar) [2], [21], [23]. In practical terms, when that bar is triggered the Tribunal cannot exercise the extension power at all.
Second, discretionary considerations: the Tribunal should exercise discretion having regard to established factors developed in administrative law, notably those in Hunter Valley and articulated in Dix's case (as cited), such as explanation for delay, prejudice to the respondent, merits of the application, fairness between parties, and whether the applicant kept the decision maker apprised of a contest of the decision [22-25]. The judge stated none of the Hunter Valley considerations are pre-conditions; their weight depends on circumstances [24].
Applying these principles to the facts, the Tribunal concluded:
For those reasons, and even if s126 did not constitutionally bar relief, the Tribunal would exercise its discretion against the builder because of the conduct and consequences of the delay [31].
Before this decision, the governing principles on extensions of time came from administrative law authorities such as Hunter Valley Developments, Dix, and High Court decisions like FAI Insurance v Southern Cross Exploration. These authorities established that all relevant circumstances should be considered and that the court should exercise a flexible discretion, taking into account factors such as explanation for delay, prejudice to other parties, merits, and fairness [22-25].
Judge Davey accepted these authorities as guiding principles but emphasised that s126 inserts a jurisdictional restriction absent from the general common-law discretionary matrix: where prejudice or detriment cannot be remedied by costs or damages, the Tribunal lacks power to extend time (paras 21, 23). The decision thus applies the established discretionary framework but affirms that statutory language in s126 imposes a hard limit which, if engaged, terminates the discretionary enquiry. The practical effect is to give greater weight to the statutory protection of the prospective respondent from unremediable detriment in the VCAT context.
Post-decision, the law remains that VCAT exercises the extension power by reference to the Hunter Valley line of discretionary factors, but always subject to the express statutory limitation in s126. This judgment illustrates how the bar in s126 operates: where delay produces non-compensable detriment to another party (broadly interpreted), VCAT must refuse an extension.
“The only limitation or fetter imposed upon that discretion is that an extension of time cannot be granted if to do so 'would cause any prejudice or detriment to a party...that cannot be remedied by an appropriate order for costs or damages.'” (para 21).
“A detriment may even include a delay in having a house repaired. Accordingly I am satisfied...that the Second Respondent would suffer detriment or prejudice that could not be satisfied by damages or additional costs.” (para 30).
“The Builder by conducting itself in the way it did and ignoring the time limits imposed by s16 of the HCG Act effectively and I find deliberately ignored its appeal rights.” (para 32).
“The result of the above is that I am deprived of the discretionary jurisdiction to extend the time for making an order extending time for fixing an appeal.” (para 31).
This judgment will be directly relevant where:
Conversely, the precedent is less likely to assist where the respondent cannot show real, ongoing detriment that cannot be remedied by damages, the applicant has a plausible excuse for delay, or the substantive merits strongly favour the applicant and prejudice is minimal.
This deep dive is restricted to the text of the decision itself. The judgment explicitly follows and cites Hunter Valley, Dix, and FAI as authorities guiding the Tribunal's exercise of discretion; it treats those authorities as supportive of a flexible discretionary approach but subordinate to the statutory bar in s126 which it considers jurisdictional [22-25]. The decision does not purport to overrule any authority; instead it applies the established discretionary factors to the VCAT statutory context and places emphasis on the statutory wording.
Practitioners should read this decision as an application of established principles to a statutory provision that narrows the Tribunal's power by reference to an unremediable prejudice/detriment test. Where later courts or tribunals cite this decision, they are likely to rely on it for the proposition that s126 operates as a jurisdictional constraint and that 'detriment' must be read broadly to include practical harms such as delayed repairs.
Threshold for 'cannot be remedied by costs or damages': The decision applies a broad conception of detriment but does not articulate a precise test or evidentiary standard for when monetary compensation is insufficient. Future cases may need to delineate how direct, certain and quantifiable the ongoing harm must be before s126's bar is triggered.
Interaction with merits: Judge Davey observed that weak merits alone do not require refusal, but the decision left open how powerful merits (e.g. clear prima facie case) weigh against unremediable detriment. A later case could consider whether exceptionally strong merits might justify extension despite some detriment.
Temporal scope of detriment: This case inferred continuing damage from exhibited material; however, a boundary remains on how short a delay must be to avoid constituting detriment, and what period of delay and degree of continuing harm are required to engage s126.
Procedural fairness and remedial orders: The judgment notes that costs or damages may sometimes cure prejudice. It leaves unanswered the range of remedial orders (beyond costs/damages) that VCAT might employ short of extension to ameliorate prejudice, and whether such orders could salvage jurisdiction in some cases.
Weight to 'sitting on rights' where delays are caused by reasonable attempts to negotiate: The decision disfavouring negotiation over prompt appeal suggests a tactical risk in attempting negotiation. But the precise boundary between legitimate good-faith negotiation/investigation and inexcusable delay remains a practical question for later adjudicators.
Practitioners advising clients should therefore gather precise evidence of any continuing harm, act promptly upon receipt of adverse decisions, and be cautious about relying on negotiations to excuse delay in commencing statutory appeals.
S126 of the Victorian Civil and Administrative Tribunal Act - discretion to
grant extension of time - interpretation of the words "prejudice or detriment"
MEDIUM NEUTRAL CITATION: [2001] VCAT 40
1. The application for an extension of time to appeal from the decision of the Housing Guarantee Fund Ltd in respect to the issue of liability for the cost of rectification is dismissed.
1. This is an application by the Applicant Builder for an extension of time in which to lodge an appeal to the Tribunal against a decision of the House Contracts Guarantee Fund Ltd ("HGF") in which it determined that the Builder was liable for the cost of repairs and rectification of a dwelling house situated at 55 Primula Avenue, Altona North ("the dwelling") arising out of a foundation failure.
2. Section 126 of the Victorian and Civil and Administrative Tribunal Act 1998 provides:-
"Extension or abridgment of time and waiver of compliance
(1) The Tribunal, on application by any person or on its own initiative, may extend any time limit fixed by or under an enabling enactment for the commencement of a proceeding.
(2) If the rules permit, the Tribunal, on application by a party or on its own initiative, may--
(a) extend or abridge any time limit fixed by or under this Act, the regulations, the rules or a relevant enactment for the doing of any act in a proceeding; or
(b) waive compliance with any procedural requirement, other than a time limit that the Tribunal does not have power to extend or abridge.
(3) The Tribunal may extend time or waive compliance under this section even if the time or period for compliance had expired before an application for extension or waiver was made.
(4) The Tribunal may not extend or abridge time or waive compliance if to do so would cause any prejudice or detriment to a party or potential party that cannot be remedied by an appropriate order for costs or damages.
"relevant enactment" means an enactment specified in the rules to be a relevant enactment for the purposes of this section."
3. Section 10 of the House Contracts Guarantee Act 1987 is in the following terms so far as is relevant:-
(c) being a builder, who is dissatisfied with the decision of the approved guarantor not to reject a claim made for loss or damage on account of a defect alleged to be caused by bad workmanship on the part of that builder;...
may, within 28 days after receiving notice from the approved guarantor of the decision, appeal to the Tribunal."
4. In March 1994 the Builder entered into a contract with Mr and Mrs Bracoulias to construct a dwelling on the rear portion of their property at 12 Ricketts Court Altona North. That property became known as 53 Primula Avenue and the construction of the house was completed on 11 August 1994.
5. So far as the Builder was concerned it only became aware that there was any complaint concerning the property when it received a letter from HGF advising it that a complaint had been received from Mrs Haining who had subsequently purchased the dwelling, in respect of foundation movement. That letter was dated 22 July 1999.
6. The letter advised the Builder that a claim had been lodged and an inspection was going to be conducted on 16 August 1999. It also enclosed a copy of the Owner's claim which provided particulars of the defects.
7. Following that letter HGF advised the Builder by further letter dated 21 January 2000 that it had engaged Worboys Plumbing to make an assessment of the cause of the problem. Ultimately on 10 April 2000 HGF advised the Builder that it considered that a defect existed and provided the Builder with a schedule of works required to be fixed by 5.00 pm on 10 May 2000. It further advised the Builder that it could seek an extension of time from the Owner and that it had a right of appeal from its decision to VCAT subject to the time limits in the Act.
8. Subsequently as a consequence of the written request from the Builder HGF extended the time of completion of the rectification to the 26 May 2000.
9. By letter dated 17 July 2000 the Builder informed HGF that it had conducted some tests at the property and as a result did not consider that it could be held responsible. That resulted in a letter from HGF dated 24 July 2000 stating that it required the work to be completed within 7 days.
10. Not to be deterred the Builder sent a letter to HGF dated 2 August 2000 enclosing a copy of a contract variations relating to deletion of paving work to the contract. In addition it concluded the letter by asserting that the damage was caused by water leaking through faulty pipes in the adjoining property.
11. The exhibited correspondence to the Builder's affidavit concludes with a letter from HGF to the Builder dated 16 November 2000 seeking payment of $44,000 being the amount of the costs of rectification and GST. That letter apparently prompted the Builder to instruct solicitors and on 29 November 2000 an application by the Builder was made to VCAT.
12. There is no correspondence relating to any further extensions of time granted by HGF other than the initial letter extending the time of completion to the 26 May 2000.
13. On 14 July 2000 HFG advised the Builder by letter that it asked the Owner to obtain quotations to carry out the work. That letter went on to state:-
"If this Company approves the Owner's claim, the claim will be paid and we will seek to recover the costs from you.
Further you are now running the risk of your registration being suspended by the Building Practitioner's Board (if applicable)."
14. The Builder appeared to ignore the above warning and in its letter to HGF of 17 July 2000 (Exhibit NM14) it concluded:-
"Until further investigation, I believe Grandville Homes cannot be held responsible."
It received a letter in response to that letter which concluded:-
"As result we request that you make arrangement to attend the required works within the next seven days. No further delays will be tolerated.
15. Apart from a further letter from the Builder dated 2 August 2000 in effect denying liability by the Builder (Exhibit NM 16) the Builder took no further steps until it received a letter from HGF of 16 November 2000 demanding payment of $44,000.
16. Pursuant to s16 of the HGF Act the Builder had 28 days from receiving the original letter of notification from HGF to file and appeal with VCAT.
17. I note that in paragraph 19 of the Applicant's affidavit reliance was placed on a conversation which took place between a Manager of the Respondent and Aris Zervas of HGF. Although VCAT is not subject to the rules of evidence, hearsay evidence which in this case was contradicted by hearsay evidence in HGF's affidavit in opposition is of little assistance.
18. In addition to the above the deponet Mr Meletis states in paragraph 29 that he had a conversation with Mr Zervas on 2 August 2000. Mr Zervas states that he was told that if there was a variation to the contract including the paving then the Builder would be absolved from responsibility. This again is disputed in the Respondent's affidavit again relying upon hearsay evidence.
19. Although I can place little weight on the rebuttal paragraph of the Builder's affidavit I do conclude that such a statement was most unlikely to have been made. It was a statement which if made would have been wholly inconsistent with the correspondence between the parties. In addition it would not have been consistent with the expert's report which is exhibited although poor drainage in the driveway is noted as a contributing factor. Having regard to the correspondence I do not accept the Builder's contention that it believed that the extension of time granted by HGF to 26 May 2000 was for the purpose of enabling the Builder to conduct further investigations. It is abundantly plain from the correspondence that the extension of time was only granted to enable the Builder to carry out the rectification work.
20. I turn now to consider whether, having regard to the matters that I have set out, an extension of time should be given to the Builder to enable an appeal out of time.
21. It will be observed that s126 of the VCAT Act gives the Tribunal discretion to extend any time fixed by or under an enabling enactment. The only limitation or fetter imposed upon that discretion is that an extension of time cannot be granted if to do so "would cause any prejudice or detriment to a party...that cannot be remedied by an appropriate order for costs or damages."
22. A consideration of the leading authorities in relation to the granting of extension of time for the making of an application for the review of an administrative decision and in particular the cases of Dix and or v Crimes Compensation Tribunal [1993] VicRp 21; 1993 1 VR 297 and FAI Insurance v Southern Cross Exploration NL [1988] HCA 13; (1987) 165 CLR 268 and Hunter Valley Developments Pty Ltd v Minister for Home Affairs and Environment [1984] FCA 176; (1984) 58 ALR 305 make it clear that in determining whether or not to grant an extension of time all the relevant circumstances should be taken into account and that a court or tribunal should not impose any fetter on the exercise of the discretion.
23. However s126 of the VCAT Act appears to differ from the general position in that the section imposes a jurisdictional limitation. That is if it can be shown that prejudice or detriment has been occasioned by the delay which cannot be compensated for by an order for additional damages or costs then the Tribunal cannot make an order for an extension of time.
24. In so far as the other considerations which are referred to in particular in the Hunter Valley Case and discussed at some length in the judgment of Brooking J in Dix's Case it is apparent that the relative weight to be given to each of the issues identified by Wilcox J in the Hunter Valley Case will depend on the particular circumstances although none of those considerations referred to by Wilcox J should be regarded as pre-conditions to a successful application for an extension of time.
25. Wilcox J in the Hunter Valley Case identified six relevant considerations which have generally been considered to be appropriate matters to take into account. They are:-
(a) In order to grant an extension of time the court needs to be positively satisfied it is proper to do so.
(b) It is relevant to consider whether or not the applicant has advanced an acceptable explanation for delay. In particular it is important to consider whether or not the applicant has rested upon his or her rights or has continued to make the decision maker aware he contests the finality of the decision.
(c) Any prejudice to the respondent including any prejudice in defending the claim occasioned by the delay.
(d) A delay which has the effect of upsetting other litigants may prove fatal to the application for an extension of time. However this is not a consideration relevant to this application
(e) The merits of the substantial application is always relevant.
(f) In addition to the above a major consideration is that of fairness between the parties.
26. The merits of the Builder's claim were not dealt with in any significant detail in the supporting affidavit. It is not necessary for me to explore the question of the strength of the Builder's case in these reasons. However this is a case concerning liability for movement of foundations.
Section 11(2) of the Housing Contracts Guarantee Act 1987 is in the following terms:-
"(2) For the purposes of this Act, if there is movement of the foundations of a dwelling-house, other than movement caused by earthquake, then--
(b) the defect is to be taken to have been caused by bad workmanship; and
(c) the builder or supervisor is liable for loss or damage suffered by a person on account of that defect if a guarantee given under this Act is in force in respect of the dwelling-house.
(3) Nothing in sub-section (2)(c) makes a builder or supervisor liable for loss or damage that the builder or supervisor proves was caused by an act or omission of a person other than--
27. On the material before me I am not persuaded of the substantial merits of the Builder's claim. However if this was the only weakness in the application I would have been unlikely to refuse the application for an extension of time.
28. In my view there is substantial merit in the submission in this case that the Builder sat on his rights. He was made aware of the decision and he was also made aware of his rights to seek a review of that decision and the fact that any application to seek a review before VCAT would involve compliance with time limits.
29. In these circumstances the evidence in particular the correspondence shows that rather than seek to review the decision the Builder decided to attempt to persuade HGF to change its mind. The only extension of time granted was to enable the Builder to carry out the rectification work. The decision of HGF was made at the time the letter containing the decision was received by the Builder. From that time on the clock was running.
30. In addition to the above in my view the conduct of the Builder in failing to seek a review of HGF's decision resulted in prejudice or detriment to the owner of the property. Because the quantum was assessed at the limit of the cover provided by the Housing Guarantee scheme of $40,000 plus the GST there was no margin left in the event that the cost of rectification increasing either because of the continuing damage done to the property as a consequence of the defective foundations or because of any increase in costs. Whilst I do not have evidence which would enable me to be satisfied that there has been an increase in costs by reason of any inflation any pressures I do have evidence in the form of Exhibit NM18 to the affidavit of Nick Meletis to the effect that the damage is continuing which enables me to infer the costs of rectification has in all probability increased. In my opinion there is sufficient material to enable me to be satisfied that Mrs Haining has suffered prejudice or at least detriment. The use of the word "detriment" in the section in my view widens the scope of the matters to be taken into consideration. A detriment may even include a delay in having a house repaired. Accordingly I am satisfied having regard to the presence of the word "detriment" used in conjunction with the word "prejudice" that the Second Respondent would suffer detriment or prejudice that could not be satisfied by damages or additional costs.
31. The result of the above is that I am deprived of the discretionary jurisdiction to extend the time for making an order extending time for fixing an appeal. However even if I am wrong in this view I would not for the reasons that I have already set out be disposed to grant an extension of time to the Builder.
32. The Builder by conducting itself in the way it did and ignoring the time limits imposed by s16 of the HCG Act effectively and I find deliberately ignored its appeal rights.
33. In these circumstances the Builder has elected as submitted by Ms Alpins to leave it to HGF to make the decision rather than seeking to review that decision. Accordingly the application for an extension of time in which to appeal against the decision of the HGF to hold the Builder liable for the cost of rectification is dismissed. Insofar as the question of quantum is concerned the Builder appears to have appealed within time and accordingly it is unnecessary for me to make any further order.
Grandville Homes Pty Ltd
HGF & Anor [2001] VCAT 40
(1987) 165 CLR 268
(1984) 58 ALR 305
Application for an extension of time to appeal dismissed; costs reserved.