Hunter Building Group Pty Ltd v Tonitto

1. The application was heard in the Tribunal on 1 November 2024.The issue between the parties as recorded in the Tribunal's reasons was the cause of the water leaks. The Home Owners contended that the pipe was severed by the Builder when the bathroom renovations were undertaken. The Builder said that the piping which drained water from the air conditioning unit did not meet Australian Standards and is used to house electrical wiring rather than water discharge. The Builder contended that the tradesperson who removed the vanity could not have been expected to determine that the piping was in fact a conduit for water from the air conditioning unit.
2. At the hearing before the Tribunal the Home Owners represented themselves and the Builder was represented by Mr Dandan, who was an employee or agent of the Builder. Both parties gave sworn evidence and each party had the opportunity to cross examine the representative(s) of the other party.
3. The Tribunal found that :
4. the piping connecting the air conditioning unit to the vanity's outlet drain was disconnected by the Builder's staff when the vanity was removed;
5. if the Builder's staff had applied due care and skill when they removed the vanity, they would have identified that the piping was a conduit for water from the air conditioning unit. They should have notified the bathroom installer that it would need to be reconnected when the vanity was reinstalled;
6. upon installation of the new vanity, the Builder should have connected the pipe to its outlet drain. The failure to reconnect the piping was the cause of the damage suffered.
7. The Tribunal did not make a finding about whether the existing piping complied with Australian Standards. The Tribunal stated that there was no evidence that the use of this piping was the cause of the leak. Furthermore, the Tribunal stated the Builder's contention that its staff assumed that piping of this kind was normally used to house electrical wiring failed to take into account that they would have observed that it was connected to the vanity's drainage.
8. The Tribunal ordered the Builder to pay $4,833.50 to the Home Owners. In order to compensate the Home Owners it was also necessary for new floorboards to be installed. The Home Owners had provided a quotation from Ozwood Australia Pty Ltd (Oz Timber) to supply and install timber flooring for $16,499 including GST. Mr Dandan informed the Tribunal that the Builder had qualified tradesmen who could install floorboards, so that it was likely to cost considerably less to the Builder to source and install the floorboards.
9. Section 48MA of the Home Building Act 1989 (NSW) relevantly provides that in proceedings under the Act in relation to a building claim involving an allegation of defective residential building work by a party to the proceedings, the court or tribunal is to have regard to the principle that rectification of the defective work by the responsible party is the preferred outcome. The Tribunal, acting in accordance with the principle stated in section 48 MA, made a rectification order directing the Builder to rectify the floorboards in accordance with the written quotation provided by Oz Timber.
10. The Tribunal noted that the parties had agreed that the necessary remedial work would be undertaken by staff of the Builder and not by the director of the Builder, Mr Majed Kanj.

1. On 9 November 2024 the Builder filed a Notice of Appeal against the decision of the Tribunal. The Notice of Appeal stated that all of the orders made by the tribunal were challenged. The sole ground of appeal stated that the Tribunal had misinterpreted the evidence concerning the Australian Standards. In particular the sole ground of appeal stated that the Tribunal failed to account for the Builder's reasonable assumption that the conduit which was in place was designed for electrical wiring rather than water drainage.
2. The Notice of Appeal stated that the Builder sought leave to appeal. The Notice of Appeal did not assert that the ground of appeal gave rise to a question of law.
3. On 13 December 2024 the Appeal Panel made orders and directions for the conduct of the appeal. These included a direction that if the Builder was relying on what had happened at the hearing before the Tribunal, it was required to lodge with the Appeal Registry and give to the Home Owners a typed transcript of the relevant parts of the hearing together with the sound recording of the entire hearing.

1. The appeal was heard on 17 March 2025. At the hearing the Builder was represented by its director, Mr Majed Kanj. The Home Owners represented themselves.
2. In his oral submissions, Mr Kanj in effect abandoned the Builder's sole ground of appeal identified in the Notice of Appeal. Mr Kanj accepted that his contractor had failed to act with due skill and care in severing the pipe and not alerting anyone to the fact that this had occurred.
3. Mr Kanj identified two complaints which he raised in his oral submissions on appeal. The first was that he said that the Builder should have been notified earlier about the water damage so that it could have taken steps to correct the problem at an earlier point in time. Secondly, Mr Kanj said that the quotation from Oz Timber on which the Tribunal had based its rectification order was disproportionate and provided an outcome for the Home Owners which went beyond reasonable rectification of the position in which they were in before the damage occurred.
4. In relation to the first complaint, the twelve pages of evidence and submissions which the Builder provided to the Tribunal before it made its decision in November 2024 were also provided to the Appeal Panel. That document does refer to a complaint by the Builder that the Home Owners failed to report and address the water damage in a timely manner. It is common ground that in June 2023 the Home Owners notified the Builder that floorboards outside the main bathroom had lifted and that in August 2023 the Builder replaced the lifted boards. At page 9 of the twelve page document which the Builder provided to the Tribunal, the Builder contended that the floorboards showed signs of buckling again from 8 December 2023 but the Builder was not notified until 23 January 2024 and that this delay likely exacerbated the damage.
5. In relation to the second complaint made by Mr Kanj to the effect that the quotation from Oz Timbers was excessive, Mr Kanj agreed that there is nothing in the twelve page document which the Builder provided to the Tribunal which refers to that complaint. Although he was not present at the Tribunal hearing in November 2024, Mr Kanj said that both complaints which he now makes had been raised orally before the Tribunal in November 2024.
6. The Home Owners supported the Tribunal's decision. They stated that the money order made by the Tribunal in their favour for $4,833.50 had been paid by the Builder. In view of the problems which they had experienced with the Builder they indicated that they would prefer a money order for the rectification of the floorboards so that they could engage a contractor of their choice.

1. The sole ground of appeal raised in the Builders' Notice of Appeal did not raise a question of law and therefore leave to appeal would have been required. The Builder did not press that ground of appeal. The two complaints made by the Builder at the hearing of the appeal are outside the terms of the ground of appeal. Leaving that difficulty to one side, neither of those complaints raise a question of law and the Builder would in any event require leave to appeal.
2. The circumstances in which the Appeal Panel may grant leave to appeal from decisions made in the Consumer and Commercial Division are limited to those set out in cl 12(1) of Schedule 4 of the Civil and Administrative Tribunal Act 2013 (NSW). In such cases, the Appeal Panel must be satisfied that the appellant may have suffered a substantial miscarriage of justice on the basis that:

(a) the decision of the Tribunal under appeal was not fair and equitable; or

(b) the decision of the Tribunal under appeal was against the weight of evidence; or

(c) significant new evidence has arisen (being evidence that was not reasonably available at the time the proceedings under appeal were being dealt with).

1. Even if the two complaints made by the Builder at the hearing of the appeal had been framed as grounds of appeal, we are not satisfied that the Builder may have suffered a substantial miscarriage of justice by reason of those matters on any of the bases identified in cl 12(1) of Schedule 4.
2. As to the first complaint made by the Builder relating to alleged delay in it being notified of the damage, the Builder did not provide a typed transcript of any part of the hearing before the Tribunal or the sound recording of the hearing. We therefore have no way of ascertaining the extent, it at all, to which this issue arose in oral evidence. Insofar as it is referred to in the twelve page document provided by the Builder to the Tribunal, it is mere assertion that delay exacerbated the damage.
3. Insofar as inferences can reasonably be drawn from the uncontroversial chronology of the matter, they do not support a conclusion that there was any relevant delay by the Home Owners in any event. When warping of the floorboards was first noticed in June 2023, the Builder was notified and attended to replace those boards. The chronology does not indicate that the Builder conducted an investigation into the cause of the warping at that time. Shortly after the Home Owners noticed further warping in December 2023 testing was carried out by plumbers engaged by the Strata Owners which identified the source of the leaks as the severed pipe within the gyprock wall. The Builder was then promptly notified.
4. As to the second complaint made by the Builder that the rectification work quoted by Oz Timber was excessive, this is plainly an issue which could and should have been raised as an issue at the hearing before the Tribunal if it was to be legitimately raised on appeal. There is nothing in the twelve page document supplied by the Builder to the Tribunal which refers to this issue. The Builder did not supply a transcript or sound recording of the Tribunal hearing so we cannot conclude that the issue in fact arose orally at the hearing. There is nothing in the reasons of the Tribunal to indicate that the issue was raised for consideration.
5. Moreover the Tribunal's reasons indicate that it was expressly at the Builder's request that the rectification order which was made took the form which it did. The Builder's representative had requested an order in that form so that the rectification work could be carried out by the Builder at considerably less cost to it.
6. We are firmly of the view that leave to appeal should be refused in relation to the two complaints made orally by the Builder on the hearing of the appeal, even if they had properly been raised as grounds of appeal.
7. A rectification order in the form made by the Tribunal reflects and implements the legislative preference for an outcome which requires rectification to be carried out by the responsible party. We can understand the Home Owners' preference for a money order, so that they could have the rectification carried out by their chosen contractor. However that is not the outcome preferred by Parliament. Now that this appeal has been determined we trust that the rectification work will be promptly carried out by the Builder in accordance with the Tribunal's orders, so that it will not be necessary for an application to be made to the Tribunal for amendment of those orders.
8. We also note the agreement of the parties that the rectification work will be undertaken by staff of the Builder and not by its director, Mr Majed Kanj.

1. The orders which we make are that leave to appeal is refused and that the appeal is dismissed.

1. (1) Leave to appeal refused.
2. (2) Appeal dismissed.

I hereby certify that this is a true and accurate record of the reasons for decision of the Civil and Administrative Tribunal of New South Wales.