1. I dismiss the application of the Joined Parties under Section 75.

2. I extend time as necessary to enable the Respondent to maintain or carry on proceedings against the Joined Parties.

3. I order the Joined Parties to pay the costs of the Respondent of and incidental to its application to extend time. In default of agreement by 31 October 2003 I refer the assessment of the same to the Principal Registrar under Section 111 of the Act who shall assess the same on Supreme Court Scale. In that event by 15 November 2003 the Respondent must file and serve its bill of costs and by 30 November 2003 the Joined Parties, if objecting, must do so in writing by document filed and served. Thereafter the Principal Registrar must carry out his assessment.

4. I direct that this matter be returned to a directions hearing as soon as convenient.

1. This case arises out of a contract of construction entered into between the Applicant and the Respondent.

2. The Applicant, which is now in liquidation, and has been so since 15 November 2000, began proceedings claiming a sum of $362,757.57. Subsequently, on 24 August 2001, the claim was struck out. On that occasion, however, it was determined that the counterclaim remained for determination. Later, on 30 May 2002, leave to proceed on the counterclaim was obtained from the Supreme Court. The counterclaim, subsequently filed, is for an amount in excess of $460,000.00. Meanwhile, and on 24 July 2001, the Joined Parties were joined as parties to the proceedings.

3. The Joined Parties, by Summons filed on 13 September 2002, have applied to strike out the proceedings, as against them, under s75 of the Victorian Civil and Administrative Tribunal Act 1998. This, amongst other things, is based on the alleged failure of the Respondent to review the decision of the Joined Parties within time. On the other hand, the Respondent, on 29 October 2002, has applied for an order to extend time and to file and serve amended points of claim.

4. In support of the position of each party I have heard evidence from witnesses and I have perused the various affidavits which have been filed. I have also given due consideration to the submissions of each of the parties.

5. Although the Joined Parties made their application first, it is appropriate if I were to consider, first of all, the submissions of the Respondent. The Respondent submits that, in reality, considering s61 of the Domestic Building Contracts Act 1995, it has no need to seek an extension of time in the matter considering also the nature of the allegations it is seeking to make. No appeal, has been lodged against the orders made on 24 July 2001, moreover. It submits, however, that if an extension of time is needed then under s126 of the 1998 Act the extension should be granted. No occasion of prejudice arises under s126(4). The Joined Parties submit, however, that the Respondent has no standing to make a claim for an extension of time having regard to the terms of an Assignment which was in evidence. If, though, the Respondent does have standing, the Joined Parties submit that the extension of time application should not be allowed. Reliance is placed in that regard also on s126(4). The Respondent contends, however, that the so-called Assignment was ineffectual in law. The Joined Parties say the Assignment was effectual and there was never an Assignment back.

6. In substance, these are the positions of the parties. As I see the matter I do not have to decide the s61 point (which I am not persuaded about: see Clifton Properties Corp Pty Ltd v Litewaite Constructions [1999] VCAT 4) if I am satisfied that an extension of time should be granted. Amongst other things, though, to be so satisfied I must be satisfied that the Respondent does not lack standing to bring the application. In turn that requires me to decide whether the Assignment has any effect or not in law.

7. In the first place, then, I must determine whether the so-called Assignment precludes the Respondent from having standing. The Assignment is expressed in these terms:

_"_NOTICE OF ASSIGNMENT OF BUILDING CONTRACT & ACKNOWLEDGMENT

FOUR SIX TWO BEACH ROAD PTY LTD (ACN 082 890 999) of 17 Taylor street, Moorabbin in the State of Victoria ("the Proprietor") HEREBY GIVES YOU NOTICE that by a Deed of Assignment bearing even date herewith made between the Proprietor of the one part and Belimar Holdings Pty Ltd ("the Mortgagee") of the other part for the consideration therein mentioned the Proprietor ASSIGNED AND TRANSFERRED unto the Mortgagee and its assigns all of the Proprietors rights, interest and benefits in the Building Contract dated the 21st day of August 1998 entered into by the Proprietor and you in respect of the property at 462 Beach Road, Beaumaris being the land in Certificate of Title Volume 6904 Folio 650 ("the Building Contract") AND the full benefit and advantage of the Building Contract and of the moneys already paid thereunder and all the Proprietor's rights, interest and benefits therein comprised.

in accordance with its Articles of Association in )

...................................... .................................

The Builder named in the Building Contract hereby acknowledges receipt of Notice of Assignment of the Building Contract in favour of the Mortgagee and agrees that in the event the Proprietor defaults under the Building Contract the Builder will give the Mortgagee written notice of such default immediately and will allow the Mortgagee a reasonable period of time (not less than fourteen (14) days) within which to remedy the default specified in such notice.

It is made under cl.5.0 of the construction contract by which it is provided: "Either party may assign their rights and duties under this Contract with the written consent of the other."

8. My view is that the Respondent does not lack standing to make its application by virtue of the alleged Assignment. My view is that that Assignment was not effectual in law. It is clear to me that cl.5.0 of the contract requires actual written consent in order for an assignment to take place. That is what the provision says. It is clear that "an attempted assignment of contractual rights in breach of a contractual provision is ineffective to transfer such contractual rights: Linden Garden Trust Ltd v Lenesta Sludge Disposals Ltd [1994] AC 85 at 108 per Lord Browne Wilkinson. But I have no evidence that L. J. Constructions Pty Ltd ever did give its consent to the assignment in question. The document dated 27 August 1998 records merely that L. J. Constructions Pty Ltd acknowledges receipt of Notice of Assignment and agrees that notice will be given to the "Mortgagee" in the event of a default. But the document, in my view, goes no further. It is nothing more than an acknowledgement of receipt and a future agreement to do something.

9. As I am of the view that the Assignment was never effectual in law, in the first place, for want of proof of consent by the Applicant, I do not need to address the issue of whether there was ever an assignment back. Cancellation of the Assignment is, thus, on this basis, not an issue.

10. The next question is, then, whether I should act under s126 of the Act to extend time. If I am of the view that I should do so, it is, again, irrelevant to exercise whether I should view s61 of the 1995 Act as the sole avenue of redress against an insurer.

"126. 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."

12. The case for an extension of time is substantially founded on a letter of 2 May 2000 which was sent to the Respondent under the hand of Mr G. Lovett. That letter in its material parts is as follows:

"Home Owners Warranty acting on behalf of the insurers wishes to advise that liability towards your claims is denied. It was noted that this matter is also subject to proceeding at the Victorian Civil and Administrative Tribunal - Building List in which both the application (LJ Constructions) and the respondent were both directed to file and serve their respective defenses and counter claims.

It is obvious from the above that a contractual dispute exists between the parties and as such Home Owners Warranty will await the outcome of the proceeding before taking any further action on your claims."

13. The argument of the Respondent is that, considering the terms of this letter, there is an "acceptable" explanation for the Respondent's delay. It is argued that this especially emerges from the stated intention of the insurers "to await the outcome of the proceeding before taking any further action on your claims." On the other hand, the Joined Parties point to the paragraph of the letter where the insurers state that they wish to advise "that liability towards your claim is denied".

14. I agree that there is this central ambiguity in the letter. It is saying both that the claim is denied and that nothing further will be done on the claim until the outcome of proceedings is known. How such a letter could have been prepared, without realizing there was this ambiguity, I am unable to say. Mr Lovett was not called to give evidence. Mr Temby, who was called, was unable to provide me with any satisfactory explanation at all. His evidence I found entirely unhelpful on the point.

15. Following, as I do, my own decision in Rapinett v Crisp (9 March 2001) also an extension of time case, I am of the view that the letter of 2 May 2000, no less than the letter of 6 January 2000 in that case, "is, at best, a study in ambiguity". This letter, like that one, on one analysis, prescribed that the Respondent must follow a course of action: it must await the outcome of proceedings before the insurers will take any further action.

16. In these circumstances, as in Rapinett, I cannot see that the Respondent has done anything wrong in having delayed commencement of proceedings against the Joined Parties. As in Rapinett again, I consider that the Respondent's position was one encouraged if not actively promoted by the stated position of the insurers.

17. In such circumstances, I am satisfied it would be an injustice if I was to hold that time should not be extended. I do not consider I am precluded from extending time by virtue of s126(4). Any prejudice or detriment contended for by the Joined Parties was, I consider, unreal or fanciful. The letter of 2 May 2000 precedes the liquidation of the application by 6 months during which the insurers did nothing about the matter. In any event, even if this were not the case, then it is not a prejudice or detriment I consider which will be caused by my decision to extend time. My decision will not be the cause of any prejudice or detriment. Any prejudice or detriment will have been caused by a failure by the insurers to take any action before the Applicant went into liquidation or by a failure by the Respondent to appeal within time. That failure is, I consider, a failure induced by the 2 May letter of the insurers but it will not be my decision to extend time which will be the cause of that prejudice or detriment within s126(4). Or it is a prejudice or detriment caused by the Joined Parties' failure to inspect. And why I might ask should a prejudice or detriment be inferred at all if the Joined Parties had indicated, as they did in their letter, that they were awaiting the outcome of proceedings.

18. In any event, to take up the question of injustice if I do not extend time, I consider I am obliged to act in accordance with s97 of the 1998 Act. Merely to extend time to allow the proceedings to be brought is not to decide the case against the joined parties on its merits. It is only to enable that case to be ventilated. I cannot say anything otherwise about the merits of the case or of what its final outcome may be.

19. I am satisfied it is proper and just for me to exercise my discretion under s126 to extend time to enable the Respondent's proceedings against the Joined Parties to be brought. I have regard to the principles laid down in such authorities as Hunter Valley Developments Pty Ltd v Cohen (1984) 3 FCR 344. I, accordingly, do so extend time.

21. I am satisfied that the Joined Parties' Summons under s75 should be dismissed. I am satisfied that the Respondent's application to extend time should be allowed. It would be very unfair in my view if I were not to allow the Respondent its costs. The Respondent I am told has incurred considerable expense in advancing an application made necessary by the stance of the Joined Parties. But that stance was hardly one of merit in light of the terms of the letter of 2 May.

22. Accordingly I order the costs of the Respondent (on Supreme Court Scale) be paid by the Joined Parties. I am satisfied under s109(2) of the 1998 Act, having regard to s109(3), that that is the fair thing to do. I so order.