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[2025] NSWCA 210
appellant. Judgment for the plaintiffs in the Court below in the sum of $483,244; respondents to pay the appellants’ costs of the appeal and in the Court below.
The Court fixed the appellants’ damages at $483,244, including GST, for the cost of rectifying their home by installing the cladding they had originally contracted for. It preferred detailed, project-specific cost evidence in several disputed categories. The respondents did not obtain a reduction by blaming the builder: the builder was not shown to have caused the relevant loss, and the respondents had not properly advanced that factual case in the lower court.
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This judgment is the quantum stage of a long dispute between Derek and Floyd Larsen, acting as trustees of the Larsen Superannuation Fund, and Tastec Pty Ltd and Stephen Sainsbury. The underlying proceedings had already resulted in findings that the respondents’ misleading or deceptive conduct caused the appellants to agree to Variation 6. The legal effect of that variation was that the appellants gave up the original contractual requirement for Maxline 340 cladding and accepted Bondor Shademaster Extraline 294 composite panels instead ([46]).
Earlier Court of Appeal proceedings established that the relevant damages were to be assessed by reference to the cost of installing Maxline 340 over the Bondor panels. The Court had previously allowed the appellants to amend their notice of appeal so that the Court of Appeal, rather than the District Court, would determine the amount of damages under s 75A of the Supreme Court Act 1970 (NSW) ([2]). This judgment therefore addresses the remaining substantive question: the amount of that loss, and whether it should be reduced because of alleged responsibility on the part of the builder, Veroc Pty Ltd ([3]-[5]).
The parties agreed that the quantum issue could be decided on the papers. They gave the Court further evidence and written submissions, and no objection was taken to the evidence ([4]). The Court considered expert engineering and quantity surveying material. The competing quantity surveyors were Mr Bolt, retained by the appellants, and Dr O’Donnell, retained by the respondents. They had prepared individual reports and a joint report, and had been cross-examined before the primary judge ([6]).
The Court ultimately assessed rectification costs at $439,312.82 excluding GST, or $483,244 including GST. It did not reduce that amount for alleged proportionate liability. The orders gave judgment for the appellants in the sum of $483,244 and required the respondents to pay the appellants’ costs of the appeal and the Court below ([36], [59], [62]).
The Court treated rectification cost as the measure already fixed by the earlier appeal: the cost of installing Maxline 340 over the Bondor panels. The question was not whether that work was the cheapest possible solution in the abstract. The Court said that the cost would be affected by the relative complexity of the task, and that it was higher than the cost would have been if the respondents had performed the original contract as agreed. That additional cost arose because of the misleading or deceptive conduct that procured agreement to Variation 6 ([17]).
The Court compared the experts’ approaches rather than assuming that standard building rates provided a reliable answer. For preliminaries, it preferred Mr Bolt’s estimated 11-week building period to Dr O’Donnell’s six weeks. Dr O’Donnell’s reports and oral evidence gave inconsistent productivity rates, and the basis of the original six-week estimate was not adequately exposed. Mr Bolt’s assessment was based on the tasks he identified, and it was supported by two builders’ tender responses, which estimated periods of at least three months and 14 to 16 weeks ([20]-[25]).
For roof and wall cladding, the Court found that Dr O’Donnell’s blended rate did not adequately reflect the cost of the specified Maxline 340 materials or substantiate the labour allowance. His approach also did not sufficiently account for the project’s remote location, the fact that the residence would remain occupied, or the particular difficulties of overcladding an existing finished house. By contrast, Mr Bolt had a material-cost basis and separately estimated labour for work items such as cappings, flashings and trims ([27]-[31]).
The Court also preferred Mr Bolt’s itemised approach to further design work. Dr O’Donnell estimated design and certification costs by reference to a percentage of total project cost. The Court accepted the criticism that a percentage benchmark could mislead for a small, complex, bespoke project, because design costs do not necessarily vary in a direct relationship with building costs. It accepted Mr Bolt’s separate figures for the revised construction certificate and updated design ([32]-[35]).
Several matters were agreed or conceded. These included a 20 per cent overhead and profit margin, a 5 per cent contingency, GST on the costs including those amounts, no need for alternative accommodation, the Home Building Compensation Fund insurance premium, replacement of only the dining and living room door assemblies, and an $800 electrical-work figure ([8]-[13]). The final schedule applied those agreed elements to the accepted cost items ([36]).
The Court rejected the respondents’ attempt to attribute some or most of the loss to Veroc. A key factual point was timing. The appellants signed Variation 6 on 24 May 2019. The Council issued its Stop Work Order on 27 May, and the respondents’ allegations about Veroc concerned later conduct ([47]). Once the variation was signed, Veroc had to carry out the work on that contractual basis. The Court said Veroc was neither obliged nor permitted to install Maxline 340, and would have acted contrary to Variation 6 if it had done so ([46]-[47]). The respondents had not established that Veroc was liable for the same loss caused by the respondents’ misleading conduct ([48]-[49]).
There was also a procedural reason to reject the argument. The respondents’ developed allegations about Veroc’s role were raised in written submissions on quantum in August 2025. The Court reviewed how the case had been conducted before the primary judge and found that the respondents had not made submissions there about Veroc’s proportionate liability for the loss caused by the misleading conduct ([50]-[56]). It held that the respondents could not depart from the way they had put their case below.
This judgment does not purport to announce a general change to the law of damages or proportionate liability. It applies the previously determined measure of damages in this litigation and the established rules and authorities it cites.
For this dispute, the earlier Court of Appeal decisions had established that the relevant counterfactual was the position the appellants would have been in but for agreeing to Variation 6. The rectification measure was the cost of installing Maxline 340, rather than the respondents’ suggested alternative based on what might have happened after the variation ([17], [61]). The present judgment then fixed the amount on the evidence.
On proportionate liability, the Court applied the requirement that the alleged concurrent wrongdoer must be or may be liable for the same loss or damage ([38]). It also applied the pleading standard stated in Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184. A defence must identify the alleged wrongdoer, the acts or omissions said to have caused the loss, and the causal connection between them. Merely naming a person who may be a concurrent wrongdoer is insufficient ([57]-[58]).
The Court also applied the rule that a party is generally bound by how it conducted its case below and may not raise a new factual case on appeal. It referred to University of Wollongong v Metwally (No 2), Coulton v Holcombe, Whisprun v Dixon and Bird v DP (a pseudonym). The limited exception described in Suttor v Gundowda Pty Ltd concerns matters of law that could not be affected by evidence; the Court found that exception did not apply here ([50], [55]).
The judgment identifies two different proportionate-liability regimes relevant to the respondents. It says Mr Sainsbury’s liability arose under s 236 of the Australian Consumer Law (NSW), engaging Part 4 of the Civil Liability Act 2002 (NSW), while Tastec’s liability arose under s 236 of the Australian Consumer Law (Cth), engaging Part VIA of the Competition and Consumer Act 2010 (Cth) ([60]). The Court said this distinction did not change the result because the respondents had not established Veroc as a concurrent wrongdoer for the loss in question.
At [17], the Court states that damages compensate the appellants for loss caused by the respondents’ conduct and confirms that the cost of rectification is the relevant measure. In plain English, the amount is tied to what it would cost to put the appellants in the position they would have occupied without the variation induced by the misleading conduct.
At [18], the Court explains that it must decide building costs on the evidence the parties provide. It does not substitute its own building-cost expertise for that evidence. This is why the judgment examines the quantity surveyors’ methods, concessions and inconsistencies in detail.
At [24], the Court accepts Mr Bolt’s first-principles assessment of the building period. That approach considered the work to be done, the method and the working environment. The Court found that the opinion was sufficiently explained and supported by the tender responses.
At [30]-[31], the Court explains why it preferred Mr Bolt’s cladding evidence. In plain English, a generic rate was not enough for an unusual, remote project involving installation over an existing finished home. The Court preferred evidence tied to actual materials and individual work items.
At [47], the Court’s central point on Veroc is that the builder was required to work under Variation 6. Since the variation had removed the Maxline 340 requirement, Veroc could not be treated as responsible for failing to install that cladding merely because the appellants later claimed its cost as rectification.
At [55]-[58], the Court explains both the procedural and pleading shortcomings in the respondents’ case. In plain English, the respondents could not wait until the quantum stage to develop a factual case against Veroc, and their pleadings did not specify the alleged wrongful acts and their connection to the appellants’ loss.
The judgment is especially relevant to disputes where damages for misleading or deceptive conduct are assessed by the cost of rectifying building work. It illustrates that the court may compare expert estimates closely, including the basis for labour productivity, project duration, material costs, design costs and the suitability of generic industry rates for unusual work ([19]-[35]).
It is also relevant where a party seeks to reduce its proportionate liability by pointing to a builder or other third party. The factual connection must be to the same loss being claimed. Here, the alleged conduct by Veroc occurred after the appellants had signed the variation that changed the required cladding, and the Court found that the builder’s duties were framed by that agreed variation ([46]-[49]).
The decision also matters where a proportionate-liability defence is stated only in general terms. The judgment emphasises that identifying a possible concurrent wrongdoer is not enough. The defence must give the material facts said to make that person liable for the relevant loss, including the conduct and the causal connection ([57]-[58]).
Finally, the decision is relevant where a party tries to develop a new factual argument on appeal or at a later stage of proceedings. The Court considered the pleadings, written submissions and the way the case had been argued below, and concluded that the respondents were bound by that earlier position ([50]-[56]).
These are applications of the court’s reasoning to the factual patterns before it, not a statement that every cladding dispute or third-party allegation will be resolved in the same way.
This judgment was delivered on 12 September 2025. The supplied judgment text contains no information about later decisions applying, distinguishing or otherwise treating it. A later-treatment history therefore cannot be stated from this source.
The judgment itself considers earlier authorities. It relies on Bingo Holdings for the pleading requirements of a proportionate-liability defence ([57]-[58]); on High Court authorities including Metwally, Coulton, Whisprun and Bird for the rule against changing the case on appeal ([50], [55]); and on Woodhouse and Hunt & Hunt for the requirement that a concurrent wrongdoer be liable or potentially liable for the relevant loss ([38]). It also refers to Zervas v Burkitt (No 2) when explaining the operation of the Australian Consumer Law and the State-based proportionate-liability regime applicable to Mr Sainsbury ([60]).
The reasons do not say that any of these earlier authorities were overruled. They are treated as governing or relevant authorities and applied to the procedural and factual circumstances of this case.
The judgment resolves the amount of damages in this proceeding, but its reasoning leaves some matters dependent on the facts and evidence in any future dispute. It does not establish that a first-principles quantity-surveying method must always be preferred, or that standard rates are never appropriate. Its preference for Mr Bolt’s evidence depended on the explanations, inconsistencies, concessions and project-specific circumstances before the Court ([21]-[35]).
Nor does the decision determine how proportionate liability would apply if a builder had participated in misleading conduct, procured a contractual variation, or performed work contrary to the relevant contract. The Court’s conclusion about Veroc depended on the finding that Veroc did not participate in the misleading conduct and was required to proceed in accordance with Variation 6 ([46]-[48]).
The judgment also does not address the full boundaries of the exception to the rule against raising a new point on appeal. It states that the exception is confined to legal matters unaffected by evidence and that it did not apply to the respondents’ factual case here ([55]). The scope of that exception in other circumstances is not decided.
Finally, the judgment does not revisit the earlier findings about the respondents’ misleading conduct or the counterfactual. It expressly says those findings would not be reconsidered and that the relevant counterfactual was settled in CA 2 ([61]). The result is therefore specific to the procedural history and findings in this litigation.
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Source: NSW Caselaw (www.caselaw.nsw.gov.au). Converted to plain text by ZoeLaw. Not the official version.
Medium Neutral Citation: Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (No 2) [2025] NSWCA 210
Hearing dates: On the papers
Decision date: 12 September 2025
Before: Adamson JA at [1]
Stern JA at [63]
Price AJA at [64]
Decision: (1) Judgment for the plaintiffs in the Court below (the appellants in this Court) in the sum of $483,244.
(2) Order the respondents to pay the appellants’ costs of the appeal and in the Court below.
Catchwords: APPEALS — amendment of notice of appeal — where proceedings ought not be remitted to Court below — where appellate court to determine quantum of damages — damages determined on the papers
DAMAGES — measure of damages — misleading or deceptive conduct — where reliance on misleading conduct caused the appellants to agree to a contractual variation — measure of loss or damage suffered as a result of variation — cost of rectification — rectification costs for installation of cladding — reliance on expert quantity surveyor evidence — proportionate liability — whether reduction required under principles of proportionate liability — where respondents bound by case put in court below
Legislation Cited: Australian Consumer Law (Cth), s 236
Australian Consumer Law (NSW), s 236
Building and Construction Industry Security of Payment Act 1999 (NSW)
Civil Liability Act 2002 (NSW), s 34
Competition and Consumer Act 2010 (Cth), s 87CB, Pt VIA
Design and Building Practitioners Act 2020 (NSW)
Fair Trading Act 1987 (NSW), s 28
Home Building Act 1989 (NSW), s 92
Supreme Court Act 1970 (NSW), s 75A
Cases Cited: Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184
Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349
Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33
Derek Larsen as Trustee for the Larsen Superannuation Fund v Tastec Pty Ltd ACN 051516682 [2024] NSWDC 518
Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10
Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145
Larsen v Tastec Pty Ltd [2023] NSWCA 39
Suttor v Gundowda Pty Ltd (1950) 81 CLR 418; [1950] HCA 35
University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; [1985] HCA 28
Water Board v Moustakas (1988) 180 CLR 491; [1988] HCA 12
Whisprun v Dixon (2003) 77 ALJR 1598; [2003] HCA 48
Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54
Zervas v Burkitt (No 2) [2019] NSWCA 236
Category: Principal judgment
Parties: Derek Larsen as trustee for the Larsen Superannuation Fund (First Appellant)
Floyd Larsen as trustee for the Larsen Superannuation Fund (Second Appellant)
Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) (First Respondent)
Stephen Sainsbury (Second Respondent)
Representation: Counsel:
I G Roberts / D S Allen (Appellants)
M R Gracie / B Dziubinski (Respondents)
Solicitors:
Mills Oakley (Appellants)
Ad Valorem Law (Respondents)
File Number(s): 2024/448106
[This headnote is not to be read as part of the judgment]
Following the Court’s decision in Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145 on 4 July 2025, the Court permitted the appellants (the Larsens), to amend their notice of appeal to seek an order that this Court determine the quantum of damages. In doing so, the Court declined to remit the assessment of damages to the District Court, thereby avoiding further delay in the resolution of the proceedings.
The parties agreed that the final substantive issue, the quantum of damages recoverable by the Larsens from the respondents, Tastec Pty Ltd and Stephen Sainsbury, arising from their misleading or deceptive conduct, be determined on the papers.
Two principal issues arise for determination. First, the extent of damages to be awarded in respect of the cost of rectifying the Larsens’ residence by the installation of Maxline 340 cladding to the walls and roof. Second, whether that amount should be reduced on the basis of the respondents’ allegation that the builder, Veroc Pty Ltd (Veroc), was proportionately liable for the Larsens’ loss.
The Court (Adamson JA, Stern JA and Price AJA agreeing) held:
Quantum of damages
(1) The cost of rectification is $483,244.
Alleged reduction of damages as a result of proportionate liability
(2) No basis for reduction on the basis of proportionate liability has been made out: [59].
(3) Veroc is not alleged to have played any part in the misleading or deceptive conduct or in procuring the Larsens’ signatures on Variation 6. Once the Larsens had accepted Variation 6, Veroc was obliged to proceed with the construction work on that basis. Veroc was neither obliged nor permitted to install Maxline 340, and to have done so would have been contrary to Variation 6: [46]-[47].
(4) Further, the respondents did not make any submissions as to Veroc’s proportionate liability to the primary judge, which were put for the first time on 19 August 2025 in their written submissions on the issue of quantum. In these circumstances, the respondents are bound by the way they put their case in the Courts below and ought not be permitted to depart from it: [53]-[55].
Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349; Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54; Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10; Whisprun v Dixon (2003) 77 ALJR 1598; [2003] HCA 48; Water Board v Moustakas (1988) 180 CLR 491; [1988] HCA 12; University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481; [1985] HCA 28; Coulton v Holcombe (1986) 162 CLR 1; [1986] HCA 33; Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184, considered.
ADAMSON JA: The dispute between, on the one hand, the appellants, Derek and Floyd Larsen as trustees of the Larsen Superannuation Fund (the Larsens) and, on the other, the respondents, Tastec Pty Ltd (Tastec) and Stephen Sainsbury, has been protracted and involved several proceedings. It is not necessary to repeat this history as it is set out in [2]-[5] of this Court’s judgment delivered on 4 July 2025: Larsen as trustee for the Larsen Superannuation Fund v Tastec Pty Ltd (formerly Wonders Building Company Pty Ltd) [2025] NSWCA 145 (CA 2).
It is sufficient to note that the original proceedings in the District Court (the Court below) were determined by Gibb DCJ (DC 1). This Court in part allowed the Larsens’ appeal against her Honour’s orders: Larsen v Tastec Pty Ltd [2023] NSWCA 39 (CA 1). This Court remitted the determination of the Larsens’ claim for relief under the Australian Consumer Law to the Court below. Their claim was heard and determined by Cole DCJ (the primary judge) who assessed their damages as nil: Derek Larsen as Trustee for the Larsen Superannuation Fund v Tastec Pty Ltd ACN 051516682 [2024] NSWDC 518 (DC 2). This Court allowed the Larsens’ appeal from that decision: CA 2. Rather than remit the assessment of damages to the Court below (as the Larsens initially sought), this Court allowed the Larsens to amend their notice of appeal to seek an order that this Court determine the quantum of damages under s 75A of the Supreme Court Act 1970 (NSW) and granted that order: CA 2, [123]-[125].
The present judgment is addressed to the final substantive issue: the quantum of damages to which the Larsens are entitled from Tastec and Mr Sainsbury as a result of the respondents’ misleading or deceptive conduct.
The parties are content to have this issue determined on the papers (the Larsens having specifically agreed to it and the respondents not having objected). To that end, they have provided further evidence to the Court, to which no objection has been taken, as well as written submissions.
Two principal issues, which will be addressed in turn, arise for consideration:
the damages that should be awarded in respect of the cost of rectification of the Larsens residence to install Maxline 340 as cladding over the walls and roof (being the damages they suffered as a consequence of the respondents’ contravening conduct); and
whether this amount ought be reduced in accordance with the principles of proportionate liability.
This Court found that the quantum of damages in the present case is to be assessed as the cost of installing Maxline 340 cladding (Maxline 340) over the Bondor 580 panels (the Bondor panels) on the roof and walls of the Larsens’ residence. The Larsens adduced evidence from engineers, Richard Noonan and Bill Moisidis, as to the way in which the rectification works could be performed. The respondents’ adduced expert evidence from Peter Karsai, who prepared a joint report with Mr Moisidis. Their solution was costed by the parties’ expert quantity surveyors: Mr Bolt (retained by the Larsens) and Dr O’Donnell (retained by the respondents). The Larsens also relied, as corroboration of Mr Bolt’s evidence, on detailed responses from two builders received by the Larsens to their requests for tender. Mr Bolt and Dr O’Donnell relied on their individual reports and also prepared a joint report dated 6 May 2024. They were cross-examined in the hearing before the primary judge.
The experts opined as to the cost of rectification works by reference to the cost of the following items:
preliminaries and building period;
roof cladding and wall cladding;
design development; and
windows and doors and miscellaneous items.
The difference between the costings of the expert quantity surveyors was, at the conclusion of the hearing before the primary judge, the difference between $526,728.80 (Mr Bolt’s figure) and $277,021.21 (Dr O’Donnell’s figure). However, as a consequence of concessions made on behalf of the Larsens, the figure which they claim has been reduced to $483,244.09 (which includes the builder’s margin of 20%, percentage for contingencies of 5%, the cost of Home Warranty Insurance of $2,576.54 and GST) or $439,312.81 (excluding GST).
The differences between Mr Bolt and Dr O’Donnell relate to various categories of cost, which will be addressed in turn.
The respondents, having lost their argument that it was inevitable that Variation 6 be agreed to because of the impracticability of installing Maxline 340 over the roof and walls of the residence, submitted that the rectification was “a straightforward over-cladding project over an existing and retained base panel”. On this basis, they submitted that Mr Bolt’s opinion ought be rejected because the amounts claimed on the basis of his evidence were disproportionate to the original contract cost. They advanced Dr O’Donnell’s figures, which were standard rates, on the basis that they were more reasonable than Mr Bolt’s.
The purpose of the damages to be awarded to the Larsens is to compensate them for the loss they have suffered as a result of the respondents’ contravening conduct. This Court has found that damages for their loss are to be assessed by reference to the cost of rectification: namely, the cost of installing Maxline 340 cladding on the roof and walls of the Larsens’ residence. The cost is affected by the relative complexity of the task. This cost is higher than had the respondents performed the contract in accordance with its terms and arises because of the respondents’ misleading or deceptive conduct in obtaining the Larsens’ agreement to Variation 6.
Further, unlike an adjudicator under the Building and Construction Industry Security of Payment Act 1999 (NSW), this Court does not apply any expertise which it may have to the assessment of building costs since it must act on the evidence adduced by the parties. Accordingly, the reasons set out below as to why particular evidence was accepted reflect the evidence which was before the Court on the issue of quantum, including the concessions made by the experts called by the parties and their methodology in arriving at the figures for various items. The Court also takes account of inconsistencies in the evidence of a witness which may affect the reliability of parts of that witness’s evidence.
Mr Bolt’s description of what “preliminaries” comprise suffices to explain what is covered: “the cost of insurances, supervision, final clean, rubbish removal, scaffolding, temporary protection and site amenities, such as temporary site offices and ablution facilities”. Self-evidently, the cost of preliminaries is affected by, and broadly proportionate to, the length of the building period.
Mr Bolt’s figure for preliminaries is $122,881.92 ($11,171 per week, based on a building period of 11 weeks) and Dr O’Donnell’s is $63,413 ($10,569 per week, based on a building period of 6 weeks). Thus the real dispute between the experts as to preliminaries is as to the length of the building period since the difference in the weekly figure is relatively small.
Unlike Mr Bolt, Dr O’Donnell did not visit the property but, instead, relied on documentation and photographs. Further, the basis of Dr O’Donnell’s initial assessment of a 6-week building period was not exposed in his report or explained in his oral evidence, as Mr Bolt observed in his response to that report, although some basis was provided in the joint report.
Dr O’Donnell’s table of costings indicates that in performing his calculations, he applied a productivity rate of 10m per hour for installing timber battens on the roof and walls and a productivity rate of 10 square metres per hour for cladding the roof and walls. However, when pressed in cross-examination while giving oral evidence concurrently with Mr Bolt at the hearing before the primary judge, Dr O’Donnell said that the rate per square metre for both the roof and the walls was 32 hours per 100 square metres (3.2 hours per 10 square metres). He explained that he calculated this rate by using a Rawlinsons rate of .22 hours per square metre and “bump[ing] it up by a third”. Dr O’Donnell agreed in cross-examination that because the project was “quite a unique project and there [was] no specific Rawlinsons or Cordell’s rate that would apply”, it was necessary to modify whatever rate appeared in those cost guides. However, he maintained that he performed an adjustment by adding a third to the Rawlinsons rate. Dr O’Donnell did not explain how he could reconcile the oral evidence he had given (3.2 hours per 10 square metres) with his evidence in his report of (1 hour per 10 square metres).
These matters adversely affect the reliability of Dr O’Donnell’s assessment of the required building period.
Mr Bolt applied what he termed a “first principles” approach to the assessment of the cost of rectification. In assessing “a reasonable labour production rate”, he considered “the nature of the work, the methodology and the environment in which the work is to be performed”. His assessment of an 11-week building period is based on his assessment of the tasks required by the rectification works which are identified by category in Appendix 5 to his report. Thus the basis of his opinion is adequately exposed and has not been shown to be unreasonable. Indeed, it gains support from the concessions made by Dr O’Donnell referred to above. It is also corroborated by the responses to tender provided to the Larsens by two builders. In his response, Ben Pirie of Pirie Homes Pty Ltd estimated the building period to be “a minimum [of] 3 months”. Heath Dyer of ProActive Building Solutions estimated that the rectification works would take 14-16 weeks, depending on the weather.
Mr Bolt’s estimate of the cost of cladding the roof was $90,684.04, which comprised $80,734.19 for the cost of installing the cladding and an additional $9,949.85 for the battens, sarking and insulation associated with the roofing work. He estimated the cost of the walling work to be $70,572.25, which comprised $54,866.74 for installing the cladding and an additional $15,705.51 for the battens, sarking and insulation associated with the walling work.
Mr Bolt used a material cost for the Maxline 340 of $84.41 per square metre, which was based on a quotation he obtained from Kingstone Industrial Group Ltd in 2020. This figure included not only the sheeting but also the sundry accessories required to install the roofing materials. He compared this figure with another costing which was contained in the materials with which he had been briefed which indicated a price for Maxline 340, as at September 2023, of $72 per square metre. Mr Bolt considered these figures to be consistent as the figure of $84.41 per square metre included accessories but the figure of $72 per square metre did not.
In his estimate of the cost of cladding, Dr O’Donnell used a “supply [$62 per square metre] and fix rate” of $80 per square metre, which was said to derive from “Rawlinsons p399 + 1/3rd”. His estimate for the cost of cladding the roof was $44,883 which comprised $39,333 (Item 1.07 for cladding and insultation, including battens) and $5,550 (Item 1.08 for “[e]dge trims colour matched”).
It is apparent from the joint report that Dr O’Donnell’s figure of $80 per square metre is a blended rate which includes materials, $62 per square metre, and labour of $18 per square metre. The figure of $62 per square metre was for generic “colourbond cladding” and did not relate specifically to Maxline 340, which is the basis for the claim for cost of rectification (for reasons given in CA 2). Further, Dr O’Donnell was unable to substantiate the labour cost of $18 per square metre, except to say that the add-on was appropriate, having regard to the remote location and the specifics of the project. He later said that the labour cost was about half the rate of $80 per square metre. Dr O’Donnell accepted that his allowance for the number of hours required was substantially less than that allowed for by Mr Bolt.
Dr O’Donnell appears to have adopted an approach which does not take adequate account of the actual cost of the materials which are required to be used for the cladding of the walls and roof (Maxline 340) and was unable adequately to substantiate his allowance for labour. His broad brush approach did not, in my view, take account of the particular difficulties of the project, including the remote location, the fact that the residence would be occupied while the work was being done and the difficulties associated with overcladding in the present case. Indeed, Dr O’Donnell accepted that he had never “come across something where you’re cladding over the top of an existing finished house before”.
Mr Bolt estimated the costs of design development would be a total of $27,807.88, comprising $20,307.88 for ‘Engage Architect/Structural Engineer – design’ and $7500 for the construction certificate and approvals in the preliminaries. In arriving at these figures, including estimating the hours required, Mr Bolt applied, as referred to above, his “first principles” approach and based his assessment on his opinion as to how long it would take to do a full survey and produce a full set of drawings. Further, he separately costed a revised construction certificate, which will be required.
By contrast, Dr O’Donnell applied a broad brush approach in arriving at his estimate of $10,000 for the construction certificate and the updated design, which he included in the amount for preliminaries (addressed above). Dr O’Donnell explained that his estimate for this item was calculated as 5% of the total cost. This approach appears to be inconsistent with Dr O’Donnell’s evidence that he would “never start this job without having a full design and full detailing of all the claddings” and that the design was only 20-30% complete. Further, it appears that Dr O’Donnell did not regard the figure of $10,000 as covering the cost of obtaining an updated construction certificate or the updated design since these were identified as assumptions which he had made rather than described as matters included in the figure of $10,000.
In response to Dr O’Donnell’s figure, Mr Bolt said that he considered a percentage benchmark to be misleading in this context since the design cost for a project which is both complex and relatively small can readily appear disproportionately high when expressed as a percentage of total cost of the work.
For the reasons given above in relation to other items, I do not accept Dr O’Donnell’s figures for costing. I accept Mr Bolt’s criticism of a percentage figure being applied to costing to arrive at a figure for a revised construction certificate and an updated design. As Mr Bolt said, in effect, there is no necessary relationship between building costs and design costs, particularly for a small bespoke project. I accept Mr Bolt’s figures for the revised construction certificate and the updated design.
| Description of work | Amount | | Wall cladding work | $54,866.74 | | Wall battens/sarking/insulation | $15,705.51 | | Roof cladding work | $80,734.19 | | Roofing battens/sarking/insulation | $9,949.85 | | Replacement of door assemblies in the dining and living rooms | $41,370 | | Electrical works | $800 | | Preliminary costs (including $7,500 for revised construction certificate) | $122,881.92 | | Revised design | $20,307.88 | | Sub-total | $346,616.09 | | Overhead and profit (20%) | $69,323.22 | | Contingency (5%) | $20,796.97 | | Home warranty insurance | $2,576.54 | | Total excluding GST | $439,312.8**2 | | GST | $43,931.28 | | **Total (**rounded, including GST) | $483,244 |
In their submissions on quantum filed on 19 August 2025, the respondents submitted that their liability to the Larsens for damages ought be reduced on the basis that Veroc Pty Ltd (Veroc) is a concurrent wrongdoer within the meaning of s 87CB(3) in Part VIA of the Competition and Consumer Act 2010 (Cth). To be a concurrent wrongdoer, the putative wrongdoer must be a person who is or may have been liable for the damage or loss: Woodhouse v Fitzgerald (2021) 104 NSWLR 475; [2021] NSWCA 54 at [83] and [91]-[95] (Basten JA, Meagher and Payne JJA agreeing), Hunt & Hunt Lawyers v Mitchell Morgan Nominees Pty Ltd (2013) 247 CLR 613; [2013] HCA 10 at [91] (Bell and Gageler JJ).
The genesis of the respondents’ submission as to proportionate liability appears to be the allegation in the respondents’ defences (paragraphs 34 and 35 of Tastec’s defence and paragraph 13 of Mr Sainsbury’s defence) that:
[Veroc] was the licensed builder for the works (licence no 18241C) and also the holder of the compulsory Home Building Compensation Fund (HBCF) insurance (certificate no 19024480) and is a concurrent wrongdoer within the meaning of Part VIA of the [Competition and Consumer Act 2010 (Cth)].
The respondents’ defences do not elaborate on the basis for this allegation, which is repeated in each of the paragraphs identified at [39]. No basis is pleaded for the allegation that Veroc is a wrongdoer.
In their written submissions on the issue of quantum filed in this Court on 19 August 2025, the respondents articulated the following basis for their defences of proportionate liability.
First, they submitted, that “Gibb DCJ found that Veroc was a concurrent wrongdoer in respect of any defective work claimed against Tastec.” In the proceedings before Gibb DCJ, the Larsens claimed against the respondents damages for breach of contract and for misleading or deceptive conduct. Her Honour rejected the contract claim. However, her Honour said, in the alternative:
Against the possibility that I am wrong in that conclusion, I have considered the plaintiff’s claim on the (in my view wrong) hypothesis that the Larsen Superannuation Fund was the contracting party through its trustees in November 2018.
No complaint is made about any failure to supply all required Ecoshelta parts or supervision of its assembly, except to the extent that any defect alleged is the product of defective building work by the builder. If that be so, to the extent that the plaintiffs’ claim is made out it simultaneously makes out the defendants**’** assertion of a concurrent wrongdoer as pleaded in paragraphs 34 and 35 of the defence to the amended statement of claim, in particular:
34. In further answer to the allegations in the ASOC that the first defendant breached any common law and/or statutory duty of care under the DBP Act, the first defendant says that those claims are an apportionable claim within the meaning of Part 4 and section 34 of the Civil Liability Act 2002 (CLA) and in respect of which Veroc Pty Ltd was the licenced builder for the works (licence no 182431C) and also the holder of the compulsory Home Building Compensation Fund (HBCF) insurance (certificate no 19024480) and is a concurrent wrongdoer within the meaning of Part 4 of the CLA.
(Emphasis added.)
This submission must be rejected. The emphasised portion does not amount to a finding that Veroc was a concurrent wrongdoer. Rather, it is a summary of the way the respondents pleaded the aspect of their defence relating to proportionate liability. The basis of her Honour’s understanding of the way in which the respondents put it was, apparently, limited to their pleaded defence.
Secondly, the respondents relied on submissions made in this Court in the hearing which led to CA 2 as to the sequence of events in May and June 2019. At that hearing, the respondents relied on these events in support of ground 3 of their notice of contention (which related to causation and mitigation and did not include any submission alleging that Veroc was a concurrent wrongdoer).
Thirdly, the respondents submitted that Veroc was wholly or mainly (alleging that a reduction of 90% in their liability was warranted) responsible for the Larsens’ loss on the following basis:
if Veroc had complied with the Stop Work Order issued by the Lithgow City Council (the Council) on 27 May 2019 (which was lifted on 26 June 2019), it remained possible for Tastec to procure Maxline 340 (paragraph 23 of respondents’ submissions filed 19 August 2025);
Veroc contributed to the aesthetic or physical mismatch of the cladding by installing, integrating and finalising the non-conforming cladding works (paragraph 23 of respondents’ submissions filed 19 August 2025);
Veroc was responsible for failing to warn the Larsens of aesthetic discrepancies (paragraph 22 of respondents’ submissions filed 19 August 2025);
Veroc should not have undertaken any interior work after lock-up of Tastec’s work until it directed the installation of the Maxline 340 to comply with the construction certificate drawings (paragraph 25 of respondents’ submissions filed 19 August 2025);
the interior work performed by Veroc substantially increased the costs of rectification (paragraph 15 of respondents’ submissions filed 19 August 2025);
the Larsens or Veroc misled the Council as the Principal Certifying Authority (paragraph 26 of respondents’ submissions filed 19 August 2025) if the Larsens remained entitled to the Maxline 340 cladding; and
as the builder, Veroc was responsible under the Home Building Act to ensure that any work complied with the contract specifications and the construction certificate (paragraph 28 of the respondents’ submissions filed 19 August 2025).
As a consequence of the respondents’ misleading or deceptive conduct, the Larsens agreed to Variation 6, the legal effect of which was (subject to their claim for relief under the Australian Consumer Law) that they forewent their right to have the building contract performed in accordance with its original terms which required the installation of Maxline 340 cladding over the panels on the walls and roof of their residence and instead agreed to the installation of Bondor Shademaster Extraline 294 composite SIPS panels. As this Court has found (in CA 1 and CA 2), their damages are to be assessed by reference to the cost of rectification: namely, the cost of installing Maxline 340 on the walls and roof of their residence, this being the position they would have been in but for the misleading or deceptive conduct. Veroc is not alleged to have played any part in the misleading or deceptive conduct or in procuring the Larsens’ signatures on Variation 6. Once the Larsens had accepted Variation 6, Veroc was obliged to proceed with the construction work on that basis.
In these circumstances, the short answer to the respondents’ submissions in support of their contention as to concurrent liability is that the Larsens signed Variation 6 on 24 May 2019, before the Council issued its Stop Work Order on 27 May 2019, before the conduct by Veroc which is now contended to ground concurrent liability and before the Council certified the works as complying with the construction certificate. Veroc, as the builder with possession of the site, was neither obliged nor permitted to install Maxline 340 and, had it done so, it would have acted otherwise than in accordance with Variation 6. Indeed, the respondents appear to have accepted this as they relied at trial (as is evident from their written submissions before Gibb DCJ extracted below) on the evidence of Mr Cover, the principal of Veroc, that he did not clad the Bondor panels with Maxline 340 because Variation 6 had been signed before the commencement of works. Further, given the Larsens’ agreement to Variation 6, it is far from clear on what basis the respondents contend that Veroc had a duty to warn the Larsens about the (by then) contractually specified Custom Bondor Shademaster Extraline 294 composite SIPS panels.
In these circumstances, the respondents have failed to establish any arguable basis on which Veroc could be said to be a concurrent wrongdoer with Tastec within the meaning of Part VIA of the Competition and Consumer Act or a concurrent wrongdoer with Mr Sainsbury within the meaning of s 236 of the Australian Consumer Law (NSW), for the loss the Larsens suffered as a result of the respondents’ misleading or deceptive conduct.
This is sufficient to dispose of the respondents’ submission that the respondents’ liability to the Larsens ought be reduced on the basis of Veroc’s liability (since none has relevantly been established).
As already explained, the respondents’ defences do not articulate the basis for the allegation that Veroc was a concurrent wrongdoer in a sense presently relevant.
In their reply submissions filed in this Court on 3 September 2025, the respondents extracted parts of their closing written submissions to Gibb DCJ:
[46] This aspect of the Larsens case by contending non-compliance with the BCA in respect of a single building component supplied by Tastec rather than the “as constructed” walls and roof, has been brought against the wrong party. (2022 Black 1/79: U-W)
…
[85] The evidence of Mr Cover [the principal of Veroc] raises the most serious issues in respect of the Larsens’ case. It is clear from the evidence of Mr Cover that he did not undertake certain works having regard to the changes that were brought about by variation 6 which was signed prior to the commencement of the works and removed the Maxline 340 cladding over the SIPS. He states that he undertook his works on the “impression” (T278:40) or expectation “that it’d eventually be cladded”: T279:5. No one told him that the project was not going to have that extra cladding over the structure: T278: 21. (2022 Black 1/93:T-X)
…
[101] There can be no doubt that the Contract between Tastec and the Larsens clearly delineated the works for which Tastec was responsible in terms of the supply and supervision of the assembly of the Ecoshelta panels and glazing. All the works before the site assembly of the Ecoshelta parts and after lock-up were clearly the responsibility of Veroc, as the Schedule of Works (Schedule 4) of the Tastec Contract also makes clear and as Mr Cover acknowledged in a text to Mr Sainsbury on 12 September 2019 in which Mr Cover stated: I am responsible for the entirety of this build and Derek and Floyd have definitely made me aware of this… (affidavit in reply para [53]) (2022 Black 1/98: S-X).
The respondent’s contentions, as summarised at [45] above (apart from (7), which was put to Gibb DCJ in the submissions extracted above but which for the reasons set out above, can be put to one side having regard to Variation 6) were put for the first time on 19 August 2025 in their written submissions to this Court on the issue of quantum.
In these circumstances, the respondents are bound by the way they put their case in the Courts below and ought not be permitted to depart from it: University of Wollongong v Metwally (No 2) (1985) 59 ALJR 481 at 483 (Gibbs CJ, Mason, Wilson, Brennan, Deane and Dawson JJ); [1985] HCA 28; Coulton v Holcombe (1986) 162 CLR 1 at 7-8 (Gibbs CJ, Wilson, Brennan and Dawson JJ); [1986] HCA 33; Whisprun at [51]; Bird v DP (a pseudonym) [2024] HCA 41; (2024) 98 ALJR 1349 at [39] (Gageler CJ, Gordon, Edelman, Steward and Beech-Jones JJ). The limited exception to this fundamental principle is confined to matters of law which could not be affected by evidence (Suttor v Gundowda Pty Ltd (1950) 81 CLR 418 at 438 (Latham CJ, Williams and Fullagar JJ); [1950] HCA 35). The exception has no application in the present case.
That the allegation that Veroc was a concurrent wrongdoer was made in general terms in the respondents’ defences is insufficient, in light of the matters set out above as to the manner in which the case was conducted before both Gibb DCJ and the primary judge, to entitle the respondents to put their case on the basis now sought.
In Bingo Holdings Pty Ltd v GC Group Company Pty Ltd [2021] NSWCA 184, this Court (Meagher, Payne and Brereton JJA), at [26]-[30] held that the “critical integers” of a person being a “concurrent wrongdoer” must be pleaded. These integers are: the identification of a person whose acts or omissions caused the loss or damage the subject of the claim; the alleged acts or omissions; and their causal connection with the damage or loss the subject of the claim. The Court said at [30]:
Text and context requires that a defendant seeking to rely on a proportionate liability defence must plead that claim with the same degree of particularity as if bringing a cross-claim against the alleged concurrent wrongdoer, setting out the relevant material facts. It is not sufficient merely to identify a class of persons one or more of whom may be a concurrent wrongdoer or wrongdoers.
I note for completeness that the Australian Consumer Law, which is in Sch 2 of the Competition and Consumer Act, operates as a law of the Commonwealth (of its own force) and, by reason of local law, a law of the various States and Territories. Mr Sainsbury’s liability to the Larsens arises under s 236 of the Australian Consumer Law (NSW), which applies by reason of s 28(1) of the Fair Trading Act 1987 (NSW): see Bell P’s analysis in Zervas v Burkitt (No 2) [2019] NSWCA 236 at [51]-[60]. Thus, the proportionate liability provisions which apply to Mr Sainsbury are to be found in Part 4 of the Civil Liability Act 2002 (NSW). Tastec’s liability to the Larsens arises from s 236 of the Australian Consumer Law (Cth), which applies to the conduct of corporations, and the applicable proportionate liability provisions are those in Part VIA of the Competition and Consumer Act. These matters do not affect the result in the present appeal since the respondents cannot, for the reasons given above, establish that Veroc is a concurrent wrongdoer.
In their written submissions filed on 19 August 2025, the respondents have sought to cavil with this Court’s findings in CA 2. These findings have been made and will not be revisited. The only remaining substantive issue in the proceedings following the delivery of CA 2 is the quantum of damages to which the Larsens are entitled, as addressed above. Accordingly, no consideration will be given to the respondents’ submissions which seek to challenge this Court’s findings. Nor will substantive consideration be given to the counterfactual relied on by the respondents in support of their submission that had Veroc installed Maxline 340 as at 18 June 2019 the cost of installation would have been $23,948.12. For the reasons given in CA 2, the relevant counterfactual for the purposes of assessing damages in the present case for misleading or deceptive conduct is the position the Larsens would have been in but for their agreement to Variation 6.
For the reasons given above, I propose the following orders:
Judgment for the plaintiffs in the Court below (the appellants in this Court) in the sum of $483,244.
Order the respondents to pay the appellants’ costs of the appeal and in the Court below.
STERN JA: I agree with Adamson JA.
PRICE AJA: I agree with Adamson JA.
**********
Larsen as trustee for the Larsen Superannuation Fund
Tastec Pty Ltd
(2024) 98 ALJR 1349
(1986) 162 CLR 1
(2013) 247 CLR 613
(1950) 81 CLR 418
(1985) 59 ALJR 481
(1988) 180 CLR 491
(2003) 77 ALJR 1598
(2021) 104 NSWLR 475
Judgment for the plaintiffs in the Court below in the sum of $483,244; respondents to pay the appellants’ costs of the appeal and in the Court below.
For these reasons, I am persuaded that Mr Bolt’s figure of $122,881.92 for preliminaries ought be accepted.
By contrast, Mr Bolt had a firm foundation for his figure for the cost of materials and estimated the labour costs by reference to individual aspects of the work, which were not addressed by Dr O’Donnell, such as installation of cappings, flashings and trims. I prefer the evidence of Mr Bolt as to the cost of wall and roof cladding.