Lucien v Mullally; Mullally v Lucien - [2021] NSWCATCD 145 - NSWCATCD 2021 case summary — Zoe

NSWNSWCATCD

Lucien v Mullally; Mullally v Lucien

[2021] NSWCATCD 145

NCAT Consumer and Commercial|2021-04-29|Before: Blake AM

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At a glance

Source facts

Court

NCAT Consumer and Commercial

Decision date

2021-04-29

Before

Blake AM

Catchwords

[2007] HCA 61 Lawrence v Ciantar
Ciantar v Lawrence [2019] NSWSC 464 Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384
[2020] VSCA 192 Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635
[2008] HCA 27 Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221

Source

Original judgment source is linked above.

Catchwords

[2007] HCA 61 Lawrence v CiantarCiantar v Lawrence [2019] NSWSC 464 Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384[2020] VSCA 192 Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635[2008] HCA 27 Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221

Judgment (310 paragraphs)

[1]

Introduction

There is no dispute between the parties that: 1. on 14 December 2018, the police directed the builder to leave the site; 2. on 17 December 2018, the owner and the builder agreed that they would continue to perform their obligations under the contract.
There is disagreement between the parties as to the circumstances in which the police directed the builder to leave the site, and consequently the legal characterisation and consequences of the events on 14 and 17 December 2018.
In his opening the builder contended that on 14 December 2018 the owner terminated the contract, and on 18 December 2018 the owner reaffirmed terminated the contract. On the basis of this contention the builder further contended that under clauses 5 and 6 of the general conditions the time for commencement began on, and completion began to run from, 18 December 2018.

[2]

[5]

The first Mullally affidavit

In the first Mullally affidavit the owner sets out the following account of the events on 14 December 2018 and their aftermath (at [35]-[44] and [119]-[121]): "35 On Friday 14 December 2018 I attended the Property to see how the Works were going. 36 The Builder was on site with the site foreman, Mr Tengstrom. At approximately 7:15am I said to the Builder and Mr Tengstrom: "The planks can't be laid this morning, as you are installing the planks incorrectly. Fixing the planks on battens at 450mm centres over a concrete slab is the correct method of installation for 19mm planks, however the planks to be installed are 16mm and these require a different method of fixing." 37 I also said words to the following effect: "I am concerned as the moisture barrier which had been installed over five weeks ago has become compromised by tears due to tradesmen walking on it. Also, the plasterers are working at the same time as the painters, so the painting job is going to be compromised by gyprock dust. " 38 The discussion escalated into an argument culminating in the Builder raising his clenched fist to my face and saying words to the following effect: "If you were a man I would punch you in the face". 39 I was scared and stepped away from the Builder and said words to the following effect: "Leave my properly." 40 The Builder refused to leave the Property and said words to the following effect of: "I will make sure that you never get to move into your house. I will smash it all down". 41 At this point it was 7:26am and I phoned the police and reported the Builder's intimidating and threatening behaviour. The Builder was standing near me whilst I was on the phone to the police making the report, and he said words to the following effect: "You have no witnesses". 42 The police said: "We will attend your property." 43 As I was in fear for my safety, I waited outside my house until the police attended at 8:12am. The police attended my property and discovered that the Builder had left the premises via the back door prior to their arrival. 44 The police spoke to the two employees who were left on site (Mr Tengstrom & Mr Archer), took their details and instructed them to leave my property. The police advised me to change the locks to my property. The police left and advised if there was any further trouble to contact them immediately. The police report number for this incident is E72344381. … … 119 After the police intervention (refer to paragraphs 35 to 45 above) on 14 December 2018 a meeting was held on 17 December 2018 with the Builder and his solicitor present. The Builder's solicitor gave an undertaking that he would assist in the resolution of ail existing and any future issues (if any) and confirmed that after the meeting he would ensure the Builder provided: a. A current schedule of all outstanding works and (realistic) estimated dates of completion noted beside each item; b. A copy of the invoice/s Mr Lucien received for all roof glazing and skylights; c. A copy of Mr Lucien's purchase order (including specifications) for the Vergola insert; d. A copy of Mr Lucien's purchase order (including specifications) for the Hella Venetian blind; e. Notification of the intended date that the water leak in the upstairs bathroom roof, through the light fitting, will be rectified; f. Notification of the intended date that the Rinnai hot water system will be semi- recessed into the wall; and g. Notification that the plastering has been completed. 120 The Builder's solicitor said to me words to the following effect (whilst looking at the list of documents referred to at paragraph 119(a) - (g) out and given to him): "I will undertake to keep the build on track and ensure that you get the copies of the outstanding documents you requested. We are going to get the build done ....If there are any future issues contact me and I will resolve it." 121 I know the special meaning of the word "undertake" when a solicitor says it. The use of that word made me feel very relieved and optimistic that my build would be back on track and kept on track. Because of this I decided to continue the build with the Builder. After the meeting I phoned the builder and advised him of my decision to continue and that I would put the keys to the site in the letterbox."

[6]

The first Lucien affidavit

In the first Lucien affidavit the builder sets out the following account of the events on 14 December 2018 and their aftermath (at [35]-[44] and [119]-[121]): "35 In relation paragraph 35, I agree that the owner attend the property. 36 In relation to paragraph 36. I say in reply that in addition to Mr. Tegstrom, Warren Archer, the painting contractors, and the plastering contractor were also on site. I agree that the owner may have made a statement to that effect. The boards were not being laid as the owner had changed her mind after the battens had been fixed for 19mm boards, giving rise to another variation to the contract. The conversation continued to the following effect: I said: "Nerida there will need to be a variation because you have changed the boards from the 19mm boards you had selected, and we have laid the battens for. Now you want a narrower width with 16mm bords, and we now need to lift up all the battens and relay them to fix the narrow 16mm floorboards to." Nerida said: "Your fucking full of shit, you're a fucking idiot, your useless, you're a wog..." I said: "Your comments are inappropriate ..." 37 In relation to paragraph 37, I do not recall this being stated by the owner. 38 In relation to paragraph 38, I make no comment. 39 In relation to paragraph 39, I agree. 40 In relation to paragraph 40, I deny the statement as alleged, and say in reply that I said to the following effect: "We have a contract and work to do, please leave us to get on with our work." 41 In relation to paragraph 41, I agree the owner called the police, I disagree that with the alleged conversation and say in reply that I said to the following effect that: "We have a contact and work to do, please leave us to get on with our work, your breaching the contract and you can't behave like this." 42 In relation to paragraph 42, I make no comment. 43 In relation to paragraph 43, I make no comment, other than that I had a doctor's appointment to attend to that morning. 44 In relation to paragraph 44, I make no comment. … 119 In relation to paragraph 119, I agree we had a meeting on that date at the neighbour's house opposite the owner's house. I do not recall the list of documents being provided to either myself or my solicitor, Mr. Wilkinson as the Owner suggests. I also do not recall Mr Wilkinson providing an undertaking that he would ensure that I would provide all the documents or do the things she has referred to at paragraphs 119(a) to (g) of her affidavit. I say this because it was the 17th of December 2018, and the Christmas shutdown was due to start on Friday 21st December 2018, and the completion of the items the owner has listed at paragraph 119(a) to 119 (g) would be contingent on the suppliers and sub-contractors availability to provide goods and services required to complete the works, and their time frames required to do this, which given the impending Christmas shut down was an issue and could never be achieved. I recall stating to the owner at this meeting to the following effect that: I said: Nerida, "I will have to speak to the suppliers and sub-contractors about when they will able to provide the materials we need, because they are all about to shut down for Christmas and I don't know when they will be back to work, and when they will be able to provide the goods and services we need. It's simply out of my control because of the Christmas shutdown." 120 In relation to paragraph 120. I do not recall Mr. Wilkinson stating this to the owner at this meeting. 121 In relation to paragraph 121, I say that I do not recall Mr. Wilkinson providing an undertaking as suggested by the owner, and in relation to the telephone call, the owner left me a message on my phone sometime later that night after the meeting and I telephoned her back and a conversation to the following effect took place: Nerida said: "Hi Tony, I promise I won't micro-manage the job, I'll leave you to run it and I won't keep coming onto the site. I'll just let you finish the works." I said: "Thankyou Nerida I really appreciate it." Nerida said: "I can leave the keys in the letter box for you to access the site again in the morning." I said: "Ok, that would be good, the trades have all finished up on site for now, and everyone has finished for the year, but we will come to site tomorrow, collect the keys and make sure everything is secure."

[10]

Consideration

Having regard to the 16 December 2018 at 4.53pm email, I prefer the account of the owner as to the events that occurred on 14 December 2018. There was no contemporaneous evidence which supports the builder's account of these events.
I am not satisfied that the builder by his threats repudiated the contract. The threatening words of the builder occurred in the context of a heated argument between the owner and the builder. While the owner had been entitled to be on the site pursuant to cl 19 of the general conditions, she had no entitlement to issue any directions as to how the works were performed as set out in the first Mullally affidavit at [36], particularly in circumstances where she had not approved variation # 10. While I accept that "(t)he discussion escalated into an argument", the evidence is silent as to what words were said and by whom. It was the police who directed Mr Tengstrom and Mr Archer to leave the property. It appears from the 16 December 2018 at 4.53pm email that this direction was given shortly after 8.12am on 14 December 2018.
It appears from the 16 December 2018 at 4.53pm email that the locks to the house on the site were changed at the request of the owner at 5.45pm on 14 December 2018. The changing of locks did not constitute a termination or purported termination of the contract by the owner as she in the 16 December 2018 at 4.53pm email indicated her willingness to meet with the builder to discuss the possible resumption of the works.
The builder never refused to perform any further work under the contract on 14 December 2018. It follows that the agreement reached between the parties on 17 December 2018 which is recorded in the 18 December 2018 at 2.24pm email was not an affirmation of the contract by the owner following a breach by the builder, but their mutual acceptance that they continued to be bound by the contract.
If, contrary to my finding in [67] above, the builder by his threats repudiated the contract, then the contract was never terminated because the owner affirmed the contract in her conversation with the builder on 17 December 2018 which is referred to in the 18 December 2018 at 2.24pm email.
It is unnecessary to determine whether the direction of the police for Mr Tengstrom and Mr Archer to leave the property on 14 December 2018 constituted an "other matter, cause or thing beyond the control of the contractor" within the meaning of that expression in cl 7 of the general conditions entitling the builder to an extension of time under cl 7 because the builder did not seek an extension of time within 10 business days of 14 December 2018 as specified in cl 7.
The changing of the locks by the owner on 14 December 2018 did not entitle the builder to an extension of time under in cl 7 of the general conditions because the builder did not suspend work in accordance with cl 24 of the general conditions on the ground of being denied access to the site so as to prevent the work from proceeding.
I am not satisfied that the concession in DCT Projects at [44] that the previous delays were not to be taken into account arising out of the parties entry into a modification agreement affirming the contract between them has any application in the circumstances of the events of 14 December 2018 and their aftermath. As found in [69] above, there was no affirmation of the contract. Further, as will be seen the parties proceeded on the basis that the provisions of the contract dealing with the time of completion of the works remained binding on them.

[13]

The applicable legal principles

In Hometeam Constructions Pty Limited v McCauley [2005] NSWCA 303 (Hometeam) at [169]-[199] McColl JA discussed the failure to proceed with reasonable diligence in a building contract: "[169] It might be accepted that the appellant's failure to complete the Works by the date for practical completion might be some evidence of delay (see Westminster Corporation v J Jarvis & Sons Ltd and Another [1970] 1 WLR 637 at 643 per Lord Hodson, at 645 per Viscount Dilhorne). However, whether delay is of itself sufficient to raise an inference of lack of due diligence must depend on the circumstances. [170] Despite the prevalence of clauses in building contracts requiring the work to be performed with "due diligence", defining the nature of that obligation has proven elusive. [171] In Re Stewardson Stubbs & Collett Pty Ltd & Bankstown Municipal Council, Moffitt J observed (at 1675-1676) that: … [T]he question of what precisely constitutes a failure to proceed with reasonable diligence is a matter of some difficulty. However, it is an allegation of a general failure to proceed with that degree of promptness and efficiency that one would expect of a reasonable builder who has undertaken a building project in accordance with the terms of the contract in question. … [173] In Hooker Constructions Pty Ltd v Chris's Engineering Co [1970] ALR 821 at 822-823, Blackburn J considered whether a head contractor had validly terminated a building sub-contract on the basis that the sub-contractor had failed "to proceed with the works with reasonable diligence" as required by the contract. After observing that the "onus is on the plaintiff to show the [sub-contractor] was in default in a way … caught by this provision", his Honour said (at 822) that he had "not found it easy to construe this phrase 'reasonable diligence' in the context of this case". He concluded that "a sensible construction of the phrase is that the actual extent of work completed is of some significance" and that " 'diligence' in the contract means … not only the personal industriousness of the defendant, but his efficiency and that of all who worked for him". [174] He also said (at 823) that he was entitled to accept as evidence that the defendant had not displayed reasonable diligence, "evidence that the work was, at the material time, seriously incomplete together with evidence that there were no circumstances preventing the defendant from overcoming this situation". [175] In Hooker the plaintiff led evidence that at the time it purported to terminate the sub-contract, the defendant's work was "seriously behind what could reasonably be expected [and] that the situation was not due to anything which was beyond the defendant's control". Although the defendant adduced evidence to show that "through no fault of his own, he was unable to get the necessary material to bring the work to the stage where it should have been at the material time", this did not convince Blackburn J who held the plaintiff had proved the contract was validly terminated. … [178] There were, in my view, in the context of the Contract, at least two ways the respondent could have established that the appellant had failed to perform the works with due diligence. [179] First she could have proved: (a) the work the appellant was required to carry out under the Contract; as events transpired this included the original contract works and the rectification work; (b) what, in addition to the contract period, was a reasonable time within which the appellant ought to have executed the original contract works and the rectification work; (c) that the appellant had failed to execute the work within that reasonable time; (d) that, to the extent the appellant proffered explanations of why the work had not been executed within that reasonable time, those explanations were unacceptable. [180] As I shall explain, the appellant's case was, essentially, that this was the way the respondent was required to prove her case and that she had failed to do so. [181] Secondly, in my view, the respondent was also entitled to seek to prove lack of due diligence by establishing a case of delay in progress during construction. This appears from both Stubbs and Hooker. On this basis she could have established a failure to carry out a reasonable amount of work by a given time; that that period of time be measured by reference to all the work to be performed under the Contract or, in absolute terms, by reference to a lack of activity on site over a significant period that could not be satisfactorily explained. The onus of proving lack of due diligence was on the respondent. If the facts established by the respondent are capable of giving rise to an inference of lack of due diligence, the appellant may discharge any evidentiary onus that may pass to it, by explaining why the work progressed at that rate: see Hobbs. That evidence should be "sufficient … to turn the scale": Brady v Group Lotus Car Cos plc [1987] 3 All ER 1050 at 1059 (CA) per Mustill LJ. … [194] In my view the appellant's failure to seek a formal extension of time in a case where the issue is whether it performed the Works with due diligence cannot be determinative. The fact that the appellant, through administrative neglect but not neglect in carrying out the work, fails to make proper claims for variations does not affect the enquiry, whether, in actually performing the work, due diligence was shown. … [197] Once it was accepted, as Her Honour found (see judgment at [237], [242]) that the rectification work constituted an agreed variation (and therefore founded an entitlement to an extension of time), the question whether the appellant performed the Works with due diligence had to take into account the period reasonably taken by the rectification work. … [199] Accordingly in order to establish that the Works, including the rectification work, had not been performed with due diligence, it was incumbent on the respondent, in my view, to call evidence of the nature of that called in Hooker to establish that at the time the Notice of Default was served, the Works were seriously incomplete and there were no circumstances preventing the appellant from having performed the Works at a more rapid rate."

[15]

The applicable contractual terms

Clause 6 of the general conditions relevantly provided: "Time for completion The contractor must diligently proceed and complete the work within 36 calendar weeks from the date the work is due to commence as referred to in Clause 5. The period of time allowed for completion has taken into account any public holidays and other days when it is known that work will not be performed. The time for completion may be subject to amendment in accordance with Clause 7."
Clause 7 of the general conditions relevantly provided: "Extension of time If the work is delayed by: • inclement weather or conditions resulting from inclement weather … • any act or omission of the owner … • the unavailability of materials necessary for the continuation of the work, unless due to the fault of the contractor • a variation to the work … • any other matter, cause or thing beyond the control of the contractor, the contractor will be entitled to a reasonable extension of time to complete the work. Both the contractor and owner (if applicable) must take all reasonable steps to minimise any delay to the work. If the contractor wishes to claim an extension of time, the contractor must notify the owner in writing of the cause and estimated length of the delay within 10 business days of the occurrence of the event or, in the case of a variation, from the date of agreement to the variation. If the owner does not, within a further 10 business days, notify the contractor in writing that the extension of time sought is unreasonable, the completion date for the contract will be extended by the period notified to the owner."
Clause 14 of the general conditions relevantly provided: "Time for payments When the contractor gives the owner a written claim for a progress payment or other amount due under the contract, the owner must pay, unless the owner notified the contractor in the manner stated below, the amount of the claim within 5 business days of receipt of the claim (which must not be less than 5 business days). …
Clause 16 of the general conditions relevantly provided: "Work done and/or materials supplied by owner … The owner will supply the materials set out below. The cost of these materials is not included in the contract price. The cost of installation by the contractor is included in the contract price. Materials only by owner As stated The owner must diligently carry out the work and supply the materials described above to avoid undue delay to the work under the contract."
Clause 27 of the general conditions relevantly provided: "Disputes If the owner or contractor considers that a dispute has arisen in relation to any matter covered by this contract, either during the progress of the work, after completion of the work or after the contract has been terminated, that person must promptly give to the other party written notice of the items of dispute. If the dispute is not resolved informally following such notification, the parties may confer with a mutually agreed third party whose role will be to assist in the resolution of the dispute by mediation or expert appraisal of the work. If the parties do not agree to confer with a third party to assist in the resolution of the dispute, or if the dispute is not resolved following the assistance of such a third party, the owner may notify Fair Trading that a building dispute exists and seek the assistance of Fair Trading to resolve the dispute. Even if a dispute has arisen the parties must, unless acting in accordance with an express provision of this contract, continue to perform their obligations under the contract so that the work is completed satisfactorily within the agreed time."

[16]

The correspondence between the parties

On 13 October 2018 at 1.31pm, Andrea Sedran on behalf of the builder sent an email to the owner (the 13 October 2018 at 1.31pm email) in she: 1. claimed 5 days were lost as a result of errors and inconsistencies in the plans, specifications and changes/variations requested by her; 2. claimed 5 days were lost as a result of variations to the laundry, concrete level changes due to an existing high sewer line which in turn necessitated changes to the plumbing to accommodate these changes, the relocation of floor wastes in ground floor bathroom, first floor bathroom, shower waste and associated pipework connected to these changes, extra storage required in roof space above bedroom, and changes to rafters framing to accommodate ceiling mounted TV; 3. claimed 34 days were lost as a result of the owner deciding to change the window supplier: "The biggest delay has occurred as a resuIt of you deciding to change the window supplier. Our window supplier presented you with a window/ door schedule which was strictly in accordance with the plans and specifications agreed. You however requested changes to the finish of these windows and doors which our window supplier was unable to meet. As a result of this impasse you found a supplier who could meet the changes you requested. We then appointed your preferred supplier to supply and install the windows and doors Our supplier did the final check measure for the windows and doors on the 26/07 /18 and agreed to install these by the 24/08/18. Your preferred supplier completed the installation on the 27/09/18, thus delaying the project by a further 34 days 1. claimed that a total number of 44 days of construction were lost as a result of these issues; 2. attached the revised building schedule; 3. offered to have a meeting "(s)hould you require any further information/explanation with regard to the schedule".
On 13 October 2018 at 5.26pm, the owner sent an email to the builder responding to the 13 October 2018 at 1.31pm email in which she: 1. accepted that 5 days were lost as a result of errors and inconsistencies in the plans, specifications and changes/variations requested by her; 2. accepted that 5 days were lost as a result of changes referred to in [82(2)] above; 3. disputed that 34 days were lost as a result of her decision to change the window supplier: "Totally disagree. The window delay was caused by the manufacturer Aneeta, not Lifestyle Glass. Aneeta do the install of ALL their windows, and Iconic would have been subjected to the same delay. Iconic quoted a totally unrealistic install date of 29 days. The delay can only be measured by the final check measure dates. Iconic did the final check measure on 26/07/18 and Lifestyle Glass did their heck measure on on (sic) 01/08/2018. Thus the delay to the project was 7 days." 1. disputed that a total number of 44 days of construction were lost as a result of these issues: "Total of 17 days were lost. In our discussions you quoted 26 weeks to complete the job. In the contract you added a 10 week buffer to allow for these type of contingencies. That is an additional 70 days were added to the completion date. Your calculations show 44 days lost and mine shows 17 days lost, yet the build will not complete on time." 1. asserted that the revised building schedule was incomplete: "The revised schedule appears to be incomplete. Please show the following items on the schedule: • Rendering all external brickwork • Building brick wall (Pearl Lane and 52/54 Pearl St boundary) • Slab work to garage area • Paving courtyard and garage area • Install garage door and pedestrian gate • Installation of Vergola • Installation of motorised blind • You have allowed 3 days for joinery is this wardrobes and bathrooms or is this the kitchen?? • After the kitchen and vanities are installed there is the electrical fit out and plumbing • The final internal job before the final clean should be the painting. • The final clean is not shown on the schedule" 1. advised her availability for a meeting: "I you will able able (sic) to respond to all my queries, I am available to meet with you at 2.30pm on Monday afternoon at Newtown. Please advise if this is suitable. The agenda: • Incomplete revised building schedule • Anticipatory breach of contract, completion due by 7 November 2018 • Roof skylights (please bring Supplier invoice showing spec's of glass used) • Lack of consultation • Air Con positioning • Safety Induction • The stone floor in bathrooms supplied by GMW will be installed at least 4 weeks after measure. The measure is pencilled for 18.10.2018 which means install will be approx 19.11.18 not 05.11.18 as reflected on your timeline • Meeting required with joiner and designer • Safety Induction"
On 23 November 2018 at 4.50pm, Sharleen Sleiman (Ms Sleiman) of Granite & Marble Works Pty Ltd (GMW) in an email to the owner stated that the builder had finished the second round of waterproofing on that day and attached an invoice for the tiles.
On 4 December 2018 at 12.18pm, the owner sent an email to the builder in which she advised a change in the specification for the garage door.
On 20 December 2018 at 7.38am, the builder in an email to the owner (the 20 December 2018 at 7.38am email) attached variation # 10 which included the following details: "Supply & fit new timber battens to concrete slab to suit height for new 16mm oak timber flooring. Supply & fit 12mm plywood sheeting on new battens between existing. Rubbish removal."
On 14 January 2019 at 10.35am, the builder in an email to the owner requested confirmation that she wished to proceed with variation # 10.
On 14 January 2019 at 11.28am, the owner sent an email to the builder in which she attached a signed copy of variation # 10 whereby she authorised the builder with the works described therein.
On 18 January 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice of default" (the 18 January 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is in default under the Contract in that; 1. It is an express term of the Contract that the Builder must diligently proceed and complete the work within 36 calendar weeks from the date the work (was) due to commence as referred to in clause 5; 2. The date referred to in clause 5 of the Contract is 1 March 2018 and therefore the date for completion of the work under the Contract was 8 November 2018; 3. The time for completion of the work under the Contract has expired however the work is not yet complete; 4. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within 10 business days of the occurrence of the delay, in order to comply with the requirements for extension of time claims under clause 7 of the Contract; 5. The Builder has persistently failed or refused to provide the Owner with information in relation to an expected date for completion of work; and 6. The Builder therefore is failing to diligently proceed with the work, (Default). FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that if the Builder does not remedy the Default within 10 business days of the date of this notice then, without prejudice to the Owner's rights, the Owner may terminate the Contract."
On 22 January 2019 at 1.23pm, the builder sent an email to the owner, which was copied to Mr Tengstrom, and in which he requested her to have the electrical appliances she was to supply delivered to the site advised that the joiner had asked to have a meeting with her on Tuesday 29 January 2019 to finalise choice of veneers and colours (the 22 January 2019 at 1.23pm email).
On 22 January 2019 at 1.49pm, the builder sent an email to the owner, which was copied to Mr Tengstrom, and in which he requested her to advise on changes to the shower screens recommended by the supplier.
On 24 January 2019 at 4.07pm, the owner sent an email to the builder in which she advised her unavailability for a meeting with the joiner on Tuesday 29 January 2019, and availability for such a meeting all day on Wednesday 29 January 2019.
On 24 January 2019 at 5.16pm, Ms Sleiman sent an email to the owner, in which she advised pricing for the laying and sealing of the stone for both bathrooms (the 24 January 2019 at 5.16pm email).
On 24 January 2019 at 5.29pm, the owner sent an email to the builder in which she advised that she had purchased the door furniture for all internal doors.
On 30 January 2019 at 4.18pm, the owner sent an email to the builder in which she advised that she had arranged for the delivery of the exterior tiles and pavers for Monday 4 February 2019, and attached the pattern design she required for the pavers to be laid in the carport area.
On 31 January 2019 at 8.32am, the builder sent an email to the owner, in which he forwarded the email Despina Ghattas of Deston Interior Pty Ltd (Deston) sent at 30 January 2019 at 2.01pm setting out the final amendments for the joinery, and requested her to confirm those final amendments.
On 31 January 2019 at 2.40pm, the owner sent an email to the builder in which she provided her instructions for the joinery.
On 31 January 2019, the builder's lawyers sent a letter to the owner's lawyers claiming an extension of time of 176 days under the contract (the 31 January 2019 letter) in which the builder's lawyers relevantly stated: "We refer to your clients notice of default dated 18 January 2019. We note that the works under this contract have been significantly delayed as a result of your client's actions, including but not limited to the New South Wales Police preventing our client from accessing the site on Friday 14 December 2018, acting under a complaint from your client. Given this occurred at a critical time in the construction program, and the impending Christmas shutdown period which followed, the delays which have flowed as a result of your client's actions have been substantial. Despite our client's efforts to co-ordinate the trades who had been organised to complete works on 14 December 2018, and thereafter before Christmas 2018, our client has had difficulty in confirming dates with the kitchen joiner, and subsequent trades to complete those aspects of the works, due to their other commitments and the Christmas shutdown period, resulting in at least We further note that the kitchen joiner required instructions from your client, which were only provided to it on 31 January 2019, but sought at a meeting cancelled by your client on 7 December 2018, which has resulted in 44 business days of delay of its self In short, your client for the above-mentioned reasons has significantly delayed this project, due to her own actions, and any alleged default by our client is factually incorrect and if your client elects to terminate the contract she does so at her own peril and in substantial breach of the contract for which our client reserves all of its rights to loss and damages it has and will suffer. EXTENSIONS OF TIME Our client hereby claims 176 business days of delay to the contract for the reasons set out below. We note that our client's extensions of time claimed to date and the revised date for practical completion is, but is not limited to as set out below: [Table in the same terms as "Delay No" 1 to 13 the table in the 8 April 2019 letter at [201] below other than the final 2 rows which states that the total is 176 business days claimed and the revised date for practical completion is 23 July 2019] Pursuant to clause 6 of the contract our client claims an extension of time as previously notified from and as set out above from 9 November 2018 until 23 July 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 23 July 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work."
On 3 February 2019 at 9.02pm, the owner sent an email to the builder in which she inquired as to the possibility of changing the profile of the back gate (the 3 February 2019 at 9.02pm email).
On 7 February 2019 at 4.02am, the owner sent an email to the builder in which she requested confirmation of specified details for the installation of the shower screens that had been discussed at a site meeting on Wednesday 6 February 2019 (the 7 February 2019 at 4.02am email).
On 7 February 2019, the owner's lawyers sent a letter to the builder's lawyers responding to the 31 January 2019 letter (the 7 February 2019 letter) in which: 1. the owner's lawyers relevantly stated: Demand We are instructed to make a demand on your client for: … B. The works to be completed expeditiously and without further delay, noting that the extension of time claims made by your client under cover of your letter dated 31 January 2019 entitled "OWNERS NOTICE OF DEFAULT" are unfounded and without any contractual or logical basis." 1. was enclosed the document entitled "owner's notice disputing builder's claim for extension of time" in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 31 January 2019, on the following grounds: [Table in the same terms as "Delay No" 1 to 10 the table in the 11 April 2019 notice at [203] below other than the final row which states that the total is 176 business days claimed and 24 days agreed] Further to the above, the Owner gives notice that: A. The Builder failed to notify the Owner of its extension of time claims within 10 business days pursuant to clause 7 of the Contract; therefore, even if the Builder's extension of time claims dated 31 January 2019 were substantiated (which is denied) any extension of claims arising out of events occurring before 16 January 2019 are invalid. B. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. C. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. D. The Builder's claim for extensions of time until 23 July 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contract with due diligence and without further delay. E. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling until the Builder's works are complete."
On 11 February 2019, the builder's lawyers sent a letter to the owner's lawyers responding to the 7 February 2019 letter in which they relevantly stated: "We are also instructed that the tiling and flooring works the subject of progress claim number 7, have been substantially completed, save for carpet laying and installation ("PC Item") which our client is still waiting for your client's written instructions as to: • Which carpet she has selected; and • Who the carpet supplier is, so that arrangements between our client and that carpet supplier can commence for the installation of the carpet? Alternatively The alternative is for your client to arrange for that aspect of the works be done herself, and a negative variation is raised for it to be deleted from the contract scope of works and price in the amount of $5,400.00 (inc GST), (being 45 square metres of carpet x $120.00 per square metre as contemplated by the contract). Secondly, the oiling of the timber floors, which cannot be completed until all other works are finished, to ensure the best possible finish to the floors, can also be deleted from the contract to and performed by your client directly. A negative variation can be raised for $180.00, (being 2 hours @ $90.00 per hour) for that work to be completed. Thirdly, our client is prepared to let your client complete the laundry splashback, and raise another negative variation for these works as follows: $240.00 (Tiler 3 hours labour @ $80.00 per hour). The delay to the splashback was caused by your client's failure to make a timely decision about the colour and finish of these cabinets, the suspension of works on 14 December 2018, in breach of clause 19 of the contract, and ongoing delays as a result of that suspension and her communicating with the sub-contractor directly, without consulting our client in breach of clause 19 of the contract which provides that: "The owner must not give directions to the contractors employees or sub-contractors" We note that these works are substantially complete, and if not, do not: ''prevent that stage of works from being reasonably capable of being used for its intended purpose." FURTHER EXTENSION OF TIMES Carpet Please be advised that a further extension of time is sought for the carpet from 9 November 2018, until the date of this letter, and continuing due to your client's failure to select and arrange for the carpet to be purchased and installation arranged with our client, with that supplier. Pavers Please also be advised that an extension of time for the pavers is also sought from 9 November 2018, until 8 February 2019, for the delay caused by your client's failure to order the pavers required at the project, which were only delivered to site on Monday 4th February 2019, and completed by our client this week. Tiling Please be advised that an extension of time for the laundry tile splashback is also sought from 14 December 2018, until 9 February 2019, and continuing for the delay caused by your client as set out above." (footnote omitted)
On 12 February 2019 at 12.31pm, the owner sent an email to the builder in which she forwarded the 7 February 2019 at 4.02am email and asked him to confirm (the 12 February 2019 at 12.31pm email).
On 12 February 2019 at 9.45pm, the owner sent an email to the builder in which she stated that it appeared that his foreman was no longer on site, and referred to work being done on Friday to Wednesday (which presumably refers to 8 and 11 to 13 February 2019).
On 13 February 2019 at 7.05am, the owner sent an email to the builder in which she asked what was happening with the kitchen as the joiner had not been back on site since the meeting on 30 January 2019, and whether he had ordered the garage door, and advised that the appliances could be seen from the street (the 13 February 2019 at 7.05am email).
On 13 February 2019 at 1.17pm, the owner sent an email to the builder in which she said that no one was on site that day.
On 14 February 2019, the owner's lawyers sent a letter to the builder's lawyers (which was incorrectly dated as 7 February 2019) alleging a failure to proceed with due diligence in which they relevantly stated: " … "Failing to proceed with due diligence Our client instructs that despite your client's assertion that he has continued to work at the site, there have been minimal workers on site this week, unsupervised by your client, and the site was left unlocked on Wednesday 13 February 2019 which is clearly not ideal. The site has been unattended yesterday and today. It is our client's position that your client is again in breach of clause 6 of the contract and furthermore, in breach of clause 12(b). … Our client looks forward to the works being finalised and all matters being resolved without further dispute. Our client reserves all her rights."
On 18 February 2019 at 5.46pm, the owner sent an email to the builder in which she said that he did not phone her in response to her left message, there were no workers on site that day and it appeared that he had abandoned the work.
On 19 February 2019 at 9.10am, the builder sent an email to the owner, which was copied to Mr Wilkinson and in which he stated that that all communication should be conducted through their solicitors, and the site had not been abandoned.
On 20 February 2019 at 8.25pm, the owner sent an email to Tony of Deston with the subject "Stone quote", which was copied to the builder, and in which she said she did not know whether the builder intends to complete the build or abandon the build, and that there have been no workers on site since 20 February 2019.
On 20 February 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice of default" (the 20 February 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is in default under the Contract in that: 1. The Builder is unable or unwilling to complete the work and has abandoned the work: a. On 8 February 2019 the construction manager removed all tools belonging to the Builder from site; b. On 13 February 2019 no subcontractors or workers were on site and the site was left unlocked; c. From 13 February 2019 there have been no subcontractors or workers on the site; and d. The Builder has failed to attend the site or carry out any works since 13 February 2019. … 3. The Builder is failing to diligently proceed with the work under the Contract: a. The Owner repeats and relies on the assertions at (1)(a)-(1)(d) above; b. Furthermore, the time for completion of the work under the Contract was 8 November 2018 however the work is not yet complete; and c. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within 10 business days of the occurrence of the delay, in order to comply with the requirements for extension of time claims under clause 7 of the Contract, (Defaults). FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that if the Builder does not remedy the Defaults within 10 business days then, without prejudice to the Owner's rights, the Owner may terminate the Contract."
On 21 February 2019 at 9.19am, the builder sent an email to the owner in which he said that as previously advised the site has not been abandoned, and that the site supervisor and a tradesperson had been on the site yesterday.
On 21 February 2019 at 10.50am, the owner sent an email to the builder in which she said that she had visited the site after 5.30pm after the end of her shift yesterday, and saw that no work had been done confirming her view that he had abandoned the site.
On 21 February 2019 at 1.03pm, the owner sent an email to the builder in which she said that she had inspected the stone bench tops which had been installed that day.
On 21 February 2019 at 6.25pm, the owner sent an email with the subject "shower screens" to Mr Wilkinson, which was copied to the builder and in which she referred to the 7 February 2019 at 4.02am email and the 12 February 2019 at 12.31pm email, and advised that as she was unable to confirm the amended specification with the builder he was to revert to the original specification (the 21 February 2019 at 6.25pm email).
On 22 February 2019 at 1.03pm, the owner sent an email to the builder in which she forwarded the email she had sent to Danny of City and Suburb and copied to Mr Wilkinson at 22 February 2019 at 10.24am asking questions about LED strips and garden lighting (the 22 February 2019 at 1.03pm email).
On 22 February 2019 at 1.12pm, the owner sent an email to the builder in which she forwarded the email she had sent to Dominic Young (Mr Young) of Sydney Tap and Bathroomware (Sydney Tap) and copied to Mr Tengstrom on 22 February 2019 at 12.20pm advising the site was ready for the delivery of all items and providing the telephone number of Mr Tengstrom.
On 22 February 2019 at 1.13pm, the owner sent an email to the builder in which she forwarded the email she had sent to Mr Tengstrom and copied to Mr Wilkinson at 22 February 2019 at 12.10pm providing instructions in response to 10 matters referred to in the email of Mr Tengstrom sent to her at 21 February 2019 at 9.59pm including: "I have been in constant contact with lifestyle doors (sic), and they advised that they will come next week. I will let you know the date. Danny sent me an email today and we are sorting the lighting out."
On 23 February 2019 at 10.58am, the owner sent an email to the builder and Mr Tengstrom, which was copied to Mr Wilkinson and in which she said that she had found the stacking doors in the light well were unlocked, she paid for the lock to be changed, and the locksmith believed that the lock had been tampered with to keep it in the open position (the 23 February 2019 at 10.58am email).
On 26 February 2019 at 9.17pm, the owner sent an email to the builder, Mr Tengstrom and Mr Wilkinson in which she advised that the bath and vanity basin had been delivered to the site yesterday, the contact details of Mr Young to arrange delivery of the remaining items, details of the BBQ and the shower screens, and requested the correct entrance door to be installed so that she could source the correct door locks (the 26 February 2019 at 9.17pm email).
On 1 March 2019, the owner's lawyers sent a letter to the builder's lawyers notifying defects (the 1 March 2019 letter) in which they relevantly stated: "We refer to the above matter. … Failing to proceed with due diligence Despite the numerous notices which have been issued by our client, our client instructs there have been minimal workers on site again this week. It remains our client's position that your client continues to be in breach of clauses 6 and 12(b) of the contract. Our client reserves all her rights."
On 5 March 2019 at 10.38am, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he requested that she purchase and provide "asap" handles and locks for the front door and rear gate.
On 5 March 2019 at 11.19am, Mr Tengstrom sent an email to the owner and the builder and in which he advised the owner that the light well door was still unlocked, and requested to have it fixed "asap as all of PC items will be on site soon".
On 5 March 2019 at 11.28am, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he requested that she provide LED light strips as "Danny is planning to be here on Thursday".
On 12 March 2019, the builder's lawyers sent a letter to the owner's lawyers claiming an extension of time of 195 days under the contract (the 12 March 2019 letter) in which they relevantly stated: "We refer to previous communications. EXTENSIONS OF TIME Our client hereby claims 195 business days of delay to the contract for the reasons set out below. We note that our client's extensions of time claimed to date and the revised date for practical completion is, but is not limited to as set out below: [Table in the same terms as "Delay No" 1 to 13 the table in the 8 April 2019 letter at [201] below other than the final 2 rows which states that the total is 195 business days claimed and the revised date for practical completion is 28 August 2019] Pursuant to clause 6 of the contract our client claims an extension for the reasons stated above and as notified from 9 November 2018, until 28 August 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 28 August 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work. Our client continues to perform its obligations under the contract."
On 12 March 2019 at 6.14pm, the owner sent an email to Mr Tengstrom which was copied to the builder and Mr Wilkinson, and in which she confirmed specifications for the shower screens "(a)s per our discussions today".
On 15 March 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice disputing builder's claim for extension of time" in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 12 March 2019, on the following grounds: [Table in the same terms as "Delay No" 1 to 13 the table in the 11 April 2019 notice at [203] below other than the final row which states that the total is 176 business days claimed and 24 days agreed] Further to the above, the Owner gives notice that; A. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. B. Importantly, the Builder previously issued a claim for extensions of time on 31 January 2019, which contained items (1) to (10) above. The Owner responded to the Builder's claim for extensions of time dated 31 January 2019 by notice served on the Builder on 7 February 2019 and in that response addressed items (1) to (10) above. The Builder has failed to acknowledge that the Builder's previous extension of time claims are without basis and has simply repeated those claims on 12 March 2019. C. The Builder failed to notify the Owner of its extension of time claims within 10 business days pursuant to clause 7 of the Contract; therefore, even if the Builder's extension of time claims dated 31 January 2019 were substantiated (which is denied) any extension of time claims arising out of events occurring before 16 January 2019 are invalid. Similarly, even if the Builder's extension of time claims dated 12 March 2019 were substantiated (which is denied) any extension of time claims arising out of events occurring before 26 February 2019 are invalid. D. Furthermore, the Builder has refused to communicate with the Owner directly since 21 February 2019, which has compounded the delay to the works under the Contract. E. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. F. The Builder's claim for extensions of time until 28 August 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contraot with due diligence and without further delay. G. The Owners notes that the correspondence from Wilkinson Building & Construction Lawyers dated 26 February 2019 contains an assertion that it is possible for the builder's trades to complete the following items in the next two weeks: i. Painting; ii. Plumbing; iii. Electrical works; iv. Roofing; V. Rendering; vi. Tiling; and vii. Shower screens. As none of these items have been completed in the two-week period ending 13 March 2019 the Owner continues to hold the view that the Builder is failing to proceed diligently with the works. H. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling, and storage costs arising from being unable to furnish the dwelling, since the date for completion under the Contract."
On 27 March 2019 at 2.03pm, Mr Tengstrom sent an email to the owner which was copied to the builder and in which he asked when her glazier would be installing glass to the door and natural light window in the front entrance.
On 28 March 2019 at 12.39pm, the builder sent an email to the owner which was copied to Mr Tengstrom and in which he advised his allowance for the garage roller door, motor and remotes.
On 28 March 2019 at 3.53pm, the owner sent an email to the builder in which she advised that a garage installer had given a quote and was "coming out tomorrow to do a measure and confirm price".
On 29 March 2019 at 3.46pm, the owner sent an email to the builder in which she forwarded the email Gary Markham of Deville Garage Doors (Deville) had sent her on 29 March 2019 at 2.53pm attaching a quotation for a garage door and requested him to "contact Deville and give them the OK to proceed".
On 1 April 2019 at 11.19am, the owner sent an email to the builder and Mr Wilkinson in which she forwarded the email Phillipa of Deville had sent her on 1 April 2019 at 11.12am thanking her for her order of a garage door.
On 4 April 2019 at 10.43am, the owner sent an email to Mr Tengstrom and the builder in which she forwarded the email Mr Young had sent her on 4 April 2019 at 10.37am advising that he had two shower handles in stock and awaiting the supply of an extra bath handle "which I was told about later".
On 5 April 2019 at 8.43am, Mr Tengstrom sent an email to the owner and the builder in which he stated that he advised Mr Young of two shower and one bathtub mixers as soon as he knew that they were not delivered, the plumber only needed one day to finish her house, that he would organise the plumber when he has all missing and needed items, and requested her "to get a ETA off Dominic as this adds to the time delays".
On 5 April 2019 at 11.25am, the owner sent an email to Mr Tengstrom in which she stated the first she knew about the bathtub mixer was when he advised her yesterday, and disputed these items were adding to time delays: "Also, I don't agree that these items are adding to time delays as we are still waiting for the garage door (3 weeks), joinery (???? Weeks), painting (????? Weeks) etc etc"
On 16 April 2019 at 8.37am, Mr Tengstrom sent an email to the owner and the builder in which he requested her to get Sydney Tap to contact her when they received the handle so that he could book in the plumber (the 16 April 2019 at 8.37am email).

[17]

The first Mullally affidavit

In the first Mullally affidavit, the owner gave the following evidence: 1. on or about 27 November 2018 she paid GMW for supply and laying the stone tiles in the bathrooms (at [81]); 2. as at 7 December 2018 there were still substantial works to complete, including but not limited to 30 specified items (at [109]); 3. on 21 February 2019 the stone benchtops were installed in the kitchen (at [126]); 4. a friend who kept her house under observation provided a record to her that the builder was not on the site for 27 days between 18 December 2018 and 27 February 2019, that subcontractors were on site for 4 of these days (11, 12, 21 and 22 February 2019) and the builder cleared all tools from the site on 1 of these days (8 February 2019). There is no record for the period from 14 January 2019 to 7 February 2019 (at [126]); 5. as to the owner's stone floor supplier/installer, the delay was caused by the builder not advising the floor supplier/installer when the waterproofing in the bathrooms would be finalised and booking a laying date. She does not believe that the alleged delay affected the critical path of the works (at [132], [137]); 6. says that as at 24 April 2019 the following 18 items of the works were incomplete (at [186]): 1. the garage door was not fitted; 2. the masonry boundary wall between the property and the adjoining property was not erected; 3. the external venetian blind was not fitted; 4. the recessed handrail for internal stairs was not installed; 5. the doors under stairs were not fitted; 6. the tiling in the laundry was not completed; 7. the shower screens were not installed; 8. the garden lights were not installed; 9. the light well tiling was not completed; 10. the shutters were not installed; 11. the kitchen garbage bin was not installed; 12. the carpet was not laid; 13. the painting was not finished; 14. the final clean had not been done; 15. wallpaper had not been fixed; 16. the rendering of the front façade had not been done; 17. the downstairs toilet had not been installed to the applicable height specifications; 18. the light fitting in the downstairs bedroom had not been installed; 1. on 12 March 2019, Sydney Woodworkers Warehouse issued its tax invoice for the purchase and delivery a front door to the site, which noted that delivery took place on that day (at [192(b)], [193]; 2. as to variation # 13, she relevantly says that: 1. the builder installed the front door on or about 6 April 2019 (at [264]); 2. she requested the builder to add horizontal lines to the rear gate on 5 February 2019, and sent the picture of the rear gate to the site foreman on 5 February 2019, and the gate is defective and requires replacement (at [268], [270]); 1. as to variation # 14, she relevantly says that the builder did not complete the following works included in this variation: 1. the re-positioning of the LED strip light (at [273(a)]); 2. the rear wall behind the laundry basin which was completed at no charge by Deston, the builder's joiner (at [273(b)]); 3. the painting under the stair area (at [273(c)]); 1. as to variation # 15, she relevantly says that the builder did not complete the works included in this variation (at [279]); 2. as to the additional works claimed by the builder, she relevantly: 1. accepts that the fitting of a TV unit in the bedroom was completed by the automation contractor (at [293(a)]); 2. says that the rendering of the neighbour's side of the dividing fence was not completed at her request (at [293(b)]); 3. says that the suspended ceiling on the first floor and the change of the floor batten level on the ground floor was not a variation (at [293(c)]); 4. says that she paid for the change to the floor batten level on the ground floor as part of variation # 10 (at [293(d)]).

[20]

The first Lucien affidavit

In the first Lucien affidavit, the builder: 1. in relation to the 30 incomplete items specified by the owner, says that he agrees, and that the owner's own conduct was the cause of 8 of these items being incomplete, and that 4 of these items were variations (at [109]); 2. says that most trades people and suppliers are closed for the first few weeks of January as are the manufacturers of building products (at [128(b)]); 3. says that the kitchen manufacturer was unavailable to supply doors between 7 December 2018 and 21 February 2019 (at [128(b)(ii)]); 4. says that the owner failed to select paint colours between 31 January 2019 and 21 February 2019 (at [128(b)(iii)]); 5. says that delays were caused by the owner's stone floor suppliers and installers (at [128(c)(i)]); 6. says that the bathtub selected by the owner could not fit up the internal stairs and required a specialist company to move it to the first-floor bathroom (at [128(c)(ii)]); 7. says that there was delay in the delivery of the tapware and fittings, and the front door (at [128(c)(iii)], [128(c)(iv)]); 8. as to the 5 April 2019 notice denies that he was failing to diligently proceed with the works (at [179]); 9. as to the 18 items of the works that the owner says were incomplete as at 24 April 2019, says that (at [186]): 1. the owner ordered the garage door on 1 April 2019; 2. the masonry boundary wall between the property and the adjoining property had been erected; 3. he had agreed with the owner that she would purchase and install the external venetian blind; 4. the recessed handrail for the internal stairs was a variation and the design had been finalised; 5. the doors under stairs were not part of the contract scope of works; 6. the design for the tiling in the laundry was changed by the owner and he did not have an opportunity to complete these works before 24 April 2019; 7. the design for the shower screens was changed by the owner and he did not have an opportunity to complete these works before 24 April 2019; 8. the owner had not decided on, and purchased the garden lights she wanted before 24 April 2019; 9. the light well tiling was not part of the contract scope of works; 10. the installation of the shutters was not part of the contract scope of works; 11. the owner was to supply the kitchen garbage this and had not done so before 24 April 2019; 12. he had agreed with the owner that she would purchase and lay the carpet; 13. the painting other than a few touches was finished; 14. the final clean could not be done before 24 April 2019; 15. the fixing of wallpaper was not part of the contract scope of works; 16. the rendering of the front façade was not part of the contract scope of works; 17. the owner's design for the downstairs toilet could not be accomplished; 18. he could not install the light fitting in the downstairs bedroom before it was purchased and delivered by the owner; 1. as to variation #13, he relevantly (at [262], [264], [270]): 1. agrees that he installed the front door on or about 6 April 2019; 2. agrees that the owner requested him to add horizontal lines to the rear gate on 5 February 2019, and sent the picture of the rear gate to the site foreman on 5 February 2019; 3. says that the rear gate was working satisfactorily when the owner took possession of the site; 1. as to variation #14, he relevantly agrees that he did not complete the works specified by the owner as at 24 April 2019 (at [273]); 2. as to variation #15, he relevantly agrees that he did not complete the works included in this variation as at 24 April 2019 (at [279]); 3. as to the additional works he has claimed, he relevantly says that he completed the TV fitting work (at 293(a)]).

[21]

The second Jamieson report

In the second Jamieson report, Mr Jamieson has relevantly expressed opinions: 1. in relation to the value of the works not completed or supplied: $26,963 comprising the following items: 1. works not executed; $9,045; 2. external venetian recessing: $2,110; 3. incorrect insulation to internal walls: $430; 4. storage room doors not installed: $2,442; 5. Items in the 11 July 2017 quote not supplied: $12,936; 1. in relation to the extension of time claims in the 31 January 2019 letter, the 12 March 2019 letter, and the 8 April 2019 letter: 1. EOT Claim 3 - Window & Door Supplier: as the window manufacturer caused the delay rather than the nominated supplier, the delay was not the responsibility of the owner, and the reasonable extension of time for this claim is nil days; 2. EOT Claim 4 - Police Suspension: as the builder did not attend site on 25 days between 17 December 2018 and 27 February 2019, the builder contributed to the delays in this period by failing to diligently progress the works on site and, therefore, an extension of time claim for 48 days is not reasonable. Further, as the events of 14 December 2018 were within the control of the builder, the extension of time claim does not fall within cl 7 of the general conditions. The reasonable extension of time for this claim is nil days; 3. EOT Claim 7 - Kitchen: in light of the alleged circumstances surrounding the purported delay, namely that the owner failed to attend one site meeting, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 4. EOT Claim 8 - Paint Colours: in light of the alleged circumstances surrounding the purported delay, namely that the paint colours were specified in the contract, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 5. EOT Claim 9 - Rain Days: without further information as to the days involved, the critical activities delayed by this event and the severity of the inclement weather he is not able to form an opinion on the reasonableness of this extension of time claim; 6. EOT Claim 10 - Stone Floor: the delays to the stone flooring were caused by the builder's coordination of the waterproofing works which was a preceding activity to the stone flooring. The builder had a responsibility to complete the preceding works and to suitably coordinate the stone installation works even although the stone supplier was selected by the owner. As the events causing the delay were within the control of the builder the extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 7. EOT Claim 11 - Carry Bathtub Up Stairs: as this event was not beyond the control of the builder by reason that It was his responsibility to install the bath and to coordinate its works to accommodate the sequence of work, and the size of the bath should have been reasonably considered in advance by an experienced builder, the extension of time claim does not fall within cl 7 of the general conditions. The reasonable extension of time for this claim is nil days; 8. EOT Claim 12 - Tapware, Fixtures & Fittings: in light of the alleged circumstances surrounding the purported delay, namely that the builder and his representative failed to act having been given details of the fixtures and fittings required, and the concurrent delays for which the builder was responsible, this extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days; 9. EOT Claim 13 - Front door: without further information as to the critical activities delayed by this event and the dates on which the delay was experienced he is not able to form an opinion on the reasonableness of this extension of time claim; 10. EOT Claim 14 - Garage door: as this event was within the control of the builder by reason that the builder was informed of the garage door selection on 4 December 2018 and that the garage door was part of the contractual scope to be supplied and installed by the builder, the extension of time claim is not reasonable. The reasonable extension of time for this claim is nil days.

[22]

The submissions of the owner

In the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. to proceed diligently implies there is a normal diligence. If that is right, the normal measure of proceeding diligently must be the time allowed for completion under the contract, that is 36 weeks. There may be exceptional circumstances in exceptional cases that make this measure inappropriate, for example, bushfires, cyclones or health orders. But that is not this case. There are no exceptional circumstances in this case; 2. the builder seeks to suggest that the owner caused delay. That is untrue. The owner kept things going by paying for items that the builder should have, but did not, ordered and paid for, such as the Hella blinds and the garage door, and by sourcing alternative contractors when the builder's contractors failed him for some reason or another, for example, the window suppliers; 3. at the time of termination, the builder was 4 months outside the time for completion under the contract.
In the owner's 28 July 2021 submissions and her oral submissions the owner made the following submissions: 1. she instructed a change to the garage door profile on 4 December 2018. The builder never ordered the garage door. According to the builder's initial time line, it was to be installed 8 days before completion. There is no indication in the builder's evidence of how or why the change of the garage door profile impacted progress of the work; 2. the builder, by his conduct, caused the delay on 14 and 17 December 2018. The work was not in the final stages of completion at the time. The floor boards had not been laid, skirting boards and architraves needed to be installed, the kitchen cabinetry was still be installed, plasterboard installation was underway, the Vergola had not been installed, the roofing was incomplete, the paving of the rear yard was not done, and the various other items as listed in the 13 January 2019 site diary remained to be done. There is no evidence from any of the trades of being unable to return to the job when required; 3. the electrical appliances were requested by the builder in the 22 January 2019 at 1.23pm email on the basis that the joiner needed the appliances on site. The stone benchtops were installed in the kitchen on 21 February 2019; 4. the builder's 16 July 2021 submissions do not suggest the amendment to the kitchen and details of paver design delayed the progress of the works; 5. the builder's 16 July 2021 submissions do not suggest changes to the shower screens recommended by the supplier delayed the progress of the works. There is no response in evidence made by the builder to the 7 February 2019 at 4.02am email, the 12 February 2019 at 12.31pm email and the 21 February 2019 at 6.25pm email in relation to the shower screens; 6. the absence of communication from the builder from 6 February 2019 shows that the builder had disengaged and left it to the owner to deal with Mr Tengstrom and the subcontractors; 7. there is no response in evidence made by the builder to the 22 February 2019 at 1.03pm email regarding her questions about LED strips and garden lighting; 8. there is no response in evidence made by the builder to the 23 February 2019 at 10.58am email regarding the unlocked stacking doors in the light well; 9. there is no response in evidence made by the builder to the 26 February 2019 at 9.17pm email regarding delivery of the bath and vanity basin and remaining items of bathware, the BBQ, the shower screens, and the entrance door; 10. there is no response in evidence made by the builder to the 13 February 2019 at 7.05am email regarding the garage door; 11. the delay in the supply of bathware did not cause delay in the progress of the works because of the time it would take to complete other work, including the garage door, joinery and painting; 12. by April 2019, the builder was 4 months past the extended completion date and anticipated further delay until December 2019. Relying on Hometeam at [181], an evidentiary onus shifts to the builder. In the absence of any reasonable explanation for his dilatory progress, the Tribunal would find that the builder was not proceeding diligently with the works.

[24]

Consideration

It is common ground between the builder and the owner that none of the variations which remain in dispute were submitted within the time frame specified in cl 7 of the general conditions.
The builder in view of not pressing variation # 16 no longer claims an extension of time of 110 days relating to this variation as specified in delay no 14 of the table in the 8 April 2019 letter.
I am satisfied that the list of incomplete works of the owner as a 7 December 2018 and 24 April 2019 set out in the first Mullally affidavit is accurate. By comparing the owner's list of items which were incomplete as at 7 December 2018 and 24 April 2019, it can be inferred that builder completed he following items after 7 December 2018: 1. erecting and rendering the masonry rear boundary fence; 2. installing a pedestrian gate in the rear boundary fence; 3. rendering the existing masonry boundary wall between the property and the adjoining property; 4. tiling the rear yard; 5. supplying power to the rear boundary wall; 6. supplying and installing a Vergola louvre roof over the courtyard; 7. supplying and installing the internal staircase; 8. supplying and installing an external mirror and an internal wall mirror; 9. installing the ground floor timber flooring; 10. supplying and installing the entertainment unit joinery; 11. supplying and installing the kitchen cabinetry; 12. supplying and installing the master bedroom wardrobe and the second bedroom walk in wardrobe; 13. laying the first floor bathroom wall tiles and stone tile floor; 14. laying the ground floor bathroom wall tiles and stone tile floor; 15. installing Center S1 Screens on the bi-fold doors; 16. re-planting the front yard; 17. installing the bath and taps in the bathroom.
I am satisfied that variations # 1 to # 11 and #13 to # 15 contain an accurate estimate of the number of days delay that will be occasioned by the carrying out of the works in the variation.
I am satisfied that the 13 January 2019 site diary is an accurate record of the work remaining to be done under the contract as at that date. It records four weeks work remaining to be done by the builder and his employees, and five weeks work remaining to be done by external trades.
I am satisfied that the extension of time claims in the 31 January 2019 letter, the 12 March 2019 letter, and the 8 April 2019 letter are not justified except to the extent accepted Mr Jamieson in the second Jamieson report. The builder adduced no expert evidence to contradict the opinions of Mr Jamieson. Further, the builder adduced no evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works.
I am not satisfied that the original contract works and the variation works were seriously incomplete as at 5 April 2019. The opinion Mr Jamieson in the second Jamieson report that the value of the works not completed or supplied is $26,963.00 in circumstances where the original contract price is $812,770.00 does not demonstrates serious incompletion, but on the contrary substantial completion.
I am satisfied that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 by reference to the principles in Hometeam at [179] for the following reasons: 1. the work the builder was required to carry out under the contract was the contract works together with works in variations # 1, # 2, # 4 to # 11, and # 13 to # 15; 2. a reasonable time within which the builder ought to have executed the original contract works and the variation works, taking into account the delay in the communication of the approval of variation # 10 by the owner until 25 January 2019 and making an assumption in favour of the builder that variations # 11 and # 13 to # 15 are justified and occasioned an additional 10 days' work, was 9 February 2019; 3. the builder failed to execute the original contract works and the variation works within that reasonable time; 4. the explanations of the builder of why the original contract works and the variation works had not been executed within that reasonable time are unacceptable because the absence of evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works.
I am also satisfied that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019 by reference to the principles in Hometeam at [181]-[199] for the following reasons: 1. the evidence including the correspondence between the parties demonstrates a lack of activity on site over a significant period from 18 December 2018 to 5 April 2019 that is not satisfactorily explained; 2. the builder did not discharge the evidentiary onus that passed to him by satisfactorily explaining the reasons for delay. In particular, the builder failed adduced any evidence to demonstrate that the various reasons for delay for which an extension of time is claimed affected the critical path for the performance of the works. Further, the builder failed adduced any evidence by Mr Tengstrom or any subcontractor explaining why the works could not proceed with that degree of promptness and efficiency that one would expect of a reasonable builder.
I am further satisfied that the owner by each of the 18 January 2019 notice and the 20 February 2019 notice gave notice to the builder of a dispute as to whether he was diligently proceed with the contract, and that each of these notices was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions of this dispute.

[28]

The applicable contractual terms

Clause 3 of the general conditions relevantly provided: "General conditions of contract It is agreed, subject to this and the other clauses of this contract, that: (a) the contractor will: • comply with the statutory warranties in section 18B of the Home Building Act 1989 and complete the work in accordance with the requirements of this contract; and …"
Clause 8 of the general conditions provided: "Completion of work The work will be complete when the contractor has finished the work in accordance with the contract documents and any variations, there are no omissions or defects that prevent the work from being reasonably capable of being used for its intended purpose, any damage of the kind referred to in Clause 19 has been repaired, and all rubbish and surplus material has been removed from the site. When the contractor believes the work is complete, the contractor must notify the owner in writing certifying that the work has been completed in accordance with this contract. Within 10 business days of receipt of written notice from the contractor, the owner must advise the contractor in writing of any items of work the owner considers to be incomplete or defective. If the owner does not so notify the contractor, the work will be taken to be complete. The contractor must complete any outstanding work promptly and again notify the owner in writing. Unless the owner notifies the contractor in writing that any item is still incomplete or defective within a further 10 business days from receipt of notification by the contractor, the work will be taken to be complete. Should there be any dispute between the parties as to whether the work has been completed, it must be dealt with in accordance with the dispute resolution procedure (Clause 27)."
Clause 9 of the general conditions relevantly provided: "Statutory warranties The contractor warrants that: (a) the work will be done with due care and skill and in accordance with the plans and specifications set out in the contract …
Clause 20 of the general conditions relevantly provided: "Identifying the site The contractor is responsible to ensure that the work is carried out on the owner's land. …"
Clause 23 of the general conditions relevantly provided: "Defects rectification The contractor must rectify omissions and defects in the work which become apparent within the period of 13 weeks from the date the work has been completed. The date of completion shall be determined in accordance with Clause 8. The owner must notify the contractor in writing of any omissions or defects which need to be made good no later than 10 business days after the expiry of the 13 week period. The contractor must rectify the omissions and defects at the contractor's own cost within 30 business days from receipt of such notification and the owner must give the contractor reasonable access for this purpose. In respect of major omissions and defects in the work, a further defects liability period of 13 weeks from the date the work has been completed will apply. If there is a dispute between the parties as to whether any item of work is defective, has been omitted or has been satisfactorily rectified the dispute must be dealt with in accordance with the dispute resolution clause (Clause 27)."
The general conditions contain notes, explanations and warnings, and relevantly provided: "Notes, Explanations and Warnings The notes, explanations and warnings that follow do not form part of the contract."
The explanation to cl 23 of the general conditions relevantly provided: "After the work has been completed omissions and defects may become apparent. … It is not intended that the defects rectification period be used to finish items of work which should have been completed to achieve completion of the work in accordance with Clause 8."
The contract relevantly specifies the following requirements: 1. as to insulation, the requirements are set out in the 1 March 2019 letter at [170] below; 2. as to the bathroom ceilings, the owner specifications specify "Aquachek 13mm"; 3. as to the shower screen installation, drawing AKD-001 of the AK specifications includes the following notation for the bathroom on the ground floor: "floor to ceiling shower screen fin [recessed]";

[29]

The correspondence between the parties

In the 1 March 2019 letter the owner's lawyers relevantly stated: "We refer to the above matter. We are instructed to notify your client of the following defects in the works carried out by your client at the site; … External paving The fall of the external paving in the carport area is predominantly towards the planter box along the boundary wall whereas the fall should be towards Pearl Lane. Our client's consultant has confirmed the fall is not in accordance with the contract. Furthermore, the consultant has raised concerns in relation to the planter box, as it appears to be servicing the water runoff from the carport. In particular, the concerns are In relation to how the planter box will drain and not flood, including how the planter box will be waterproofed to prevent moisture damage to external finishes i.e. cement render and paint finishes. We are instructed that as the fall is quite pronounced, the paving looks sloped to the eye. On the opposite wall to the boundary planter box, the paving is higher than the courtyard retaining wall. Our client requires rectification of the fall so that it is in accordance with the design in the contract. Insulation We are instructed the insulation has not been installed in accordance with the contract documents: 1. BASIX: a. The BASIX Report Specifications specify a foil backed blanket of 75mm. b. The builder has installed a product which is 55mm. c. As such, the builder has not complied with the BASIX specifications. 2. ACOUSTIC REPORT: a. The acoustic report contains two options: i. Option 1 - • Metal deck roof; and • One layer of 19 mm thick particleboard or 9 mm thick fibre cement laid below; and • Minimum 50 mm thick glasswool insulation (min density 10 kg/m3) with vapour barrier such as Anticon roofing blanket installed between the metal deck roof and the particleboard/fibre cement; and • Minimum 90 mm thick glasswool insulation (min density 10 kg/m3) such as CSR Bradford Gold Batts R2.0 or equivalent installed inside the roof cavity between the ceiling joists or rafters; and • One layer of 13 mm thick sound-rated or fire-rated plasterboard for the ceiling in Bedrooms 2 and 3. One layer of standard 13 mm thick plasterboard is sufficient over other areas; and • Minimum airgap of 200 mm between the particleboard and the ceiling (the insulation recommended above is installed inside the airgap). b. The builder did not install "one layer of 19 mm thick particleboard or 9 mm thick fibre cement laid below". c. As such, the builder has not complied with Option 1 of the acoustic report specifications. i. Option 2 - • Metal deck roof with Heavy Duty Barking vapour barrier; and • Minimum 90 mm thick glasswool insulation (min density 10 kg/m3) such as CSR Bradford Gold Batts R2.0 or equivalent installed inside the roof cavity between the ceiling joists or rafters; and • Two layers of 13 mm thick sound-rated or fire-rated plasterboard for the ceiling in Bedrooms 2 and 3. One layer of 13 mm thick sound-rated or fire-rated plasterboard is sufficient over other areas; and • Minimum airgap of 200 mm between the metal deck roof and the ceiling (the insulation recommended above is installed inside the airgap). d. The builder did not install a "Heavy Duty Barking vapour barrier". e. As such, the builder has not complied with Option 2 of the acoustic report specifications. f. Our client is unaware if two layers of plasterboard has been installed in Bedrooms 2 and 3 or not. 3. CONTRACTUAL SPECIFICATION: a. The specification in the contract specifies: • Metal Deck Roof • Bradford Heavy Duty Anticoni 30 • 19mm particleboard • Bradford Soundscreen R3.1 • 13mm Gyprock Soundchek b. The builder did not install Bradford Heavy Duty Anticon 130. c. The builder did not install 19mm particleboard. d. The builder did not install Bradford Soundscreen R3.1. e. As such, the builder has not complied with the specification in the contract in respect of insulation. Our client's consultant expressed concerns at his inspection about the level of heat in the upstairs areas. Please have your client provide a response to the insulation assertions by 5:00pm Tuesday 5 March 2019. … Our client reserves all her rights."
On 29 March 2019, the owner's lawyers sent a letter to the builder's lawyers notifying the builder that specified defects in the works had not been rectified and that the works were encroaching over the boundary of the property (the 29 March 2019 letter) in which they relevantly stated: "We refer to our letter dated 1 March 2019 in which our client provided notification of various defects in the works carried out by your client. We note we requested a response to our client's notification by 5 March 2019 and you subsequently advised your client would provide a response by 8 March 2019. We have not received any such response to date. … External paving Your client has not rectified the issue with the direction of fall in the paving, which was previously notified to your client. Insulation In our letter dated 1 March 2019 we provided detailed information in relation to the non-compliance of the insulation. Your client has not provided a response to the non-compliance issues nor has he rectified the insulation. Our client has obtained expert advice from Mr Zervos from CRD Building Consultants & Engineers as follows: 1. In the wall adjoining the neighbouring property, 54 Pearl Street, your client has installed one layer of Fyrchek whereas the contract and the BASIX require two layers. 2. The insulation in the ceiling is undersized - 1.3 R rating has been used whereas 3.8 R rating was specified in the contract. 3. The insulation in the walls is not as specified. 4. The sound insulation has not been installed in accordance with contract specifications and is missing in some areas of the ceiling upstairs. 5. Acoustic plasterboard has not been installed in accordance with contract specifications to areas in the kitchen - normal plasterboard has been used instead. Bathroom ceiling Our client has also obtained advice that the ceiling installed in the bathroom is not water-resistant plasterboard such as Aquachek. The bathroom ceiling is therefore defective and requires replacement. Shower screen installation The tiling in the bathroom does not allow for the shower screen to be channel-set. Your client's representative has advised that the shower screen will not be channel-set because your client "doesn't like doing that'' despite the contract specifications providing for this method of installation. Our client puts your client on notice that if he proceeds to install the shower screens without first rectifying the tiling to include channels, your client will incur unnecessary costs for removal and re-installation of the shower screens which could have been avoided. Our client requires the shower screens to be channel-set and the tiling in the bathroom to be rectified to allow for same. Encroachments We enclose survey obtained by our client showing multiple encroachments over the boundary, as a result of your client's works. Please advise how your client intends to rectify these issues. Rectification We are instructed to request your client provide a written timeline for attending to rectification of the defects and the replacement of improper materials, by 5:00pm Monday 1 April 2019. Our client reserves all her rights."
The survey attached to the 29 March 2019 letter is sheet 2 of a boundary plan by an unidentified person contains notations with measurements as to various parts of the building being "clear" and "overhang" and a brick wall from the front verandah to the front of the property on the common boundary with the adjoining property on the northern side.
On 8 April 2019, the builder's lawyers sent a letter to the owner's lawyers (the 8 April 2019 letter) in which they asserted that the defects liability period had not commenced, and relevantly stated: "We refer to your letter of 29 March 2019, and are instructed to reply as follows, noting that the defects liability period has not yet commenced. … EXTERNAL PAVING Our client denies that there is an issue with the paving, which has been completed as per the finish floor levels. INSULATION In relation to point 1, our client has installed two (2) lawyers of Fyrcheck insulation. We are instructed that the BASIX certificate makes no mention of the layers of Fyrcheck, but we would be grateful if you could refer us the relevant provision of the BASK certificate seeking this, if we are mistaken? In relation to point 2, our client has installed R3.1 as per the contract, we are instructed that there is no R3.8 insulation as contended by your client. In relation to point 3, the insulation in all external and internal walls is R2.5, which is higher than that specified in the contract. In relation to item 4, the insulation has not been placed around down lights, or where the ceiling mounted television is located, due to insufficient ceiling space, which is taken up by the television and the clearance required around the television, and ceiling lights. In relation to item 5, we are instructed that there were no plastering specifications provided in relation to the double brick wall as this was originally to have been cement rendered. Plasterboard was directly fixed to the brick walls as per standard building practices to achieve the same finish as the other walls in that area. BATHROOM CEILING Our client denies your clients assertion and our client further says that Aquacheck has been used in all bathrooms. SHOWER SCREEN INSTALLATION The channel set sought by your client is not an appropriate method of installation, and exposes the shower screens to significant failure. If your client would like that to have the shower screens installed in that manner, we would suggest that a negative variation be raised for this item, and the works be performed by one of your client's own trades people directly for her? Failing agreement to such a course, our client will install the shower screens in an appropriate and structurally adequate manner, in accordance with good building practices. ENCROACHMENTS Your client in conjunction with the previous neighbour agreed where the location of the dividing wall was to be located, as per the attached emails. Our client installed the dividing wall as instructed and accepts no liability or responsibility for these alleged encroachments whatsoever, as dividing wall was located as instructed by your client, in agreement with her neighbour. RECTIFICATION Given the abovementioned responses, our client is unable to, and is not required to provide a timeline to rectify the alleged issues. We also note again that the defects liability period has not commenced. …"
The emails attached to the 8 April 2019 letter included: 1. the email sent on 27 March 2018 at 12.58pm by the owner to Matthew Fitzmaurice (Mr Fitzmaurice) with the subject "Boundary fence" in which she relevantly stated: "With my renovation, I would like to replace the existing boundary paling fence, with a brick fence. It will be the same height. I think this will offer more privacy between our two houses and stop our dogs "facing off"!! The proposed brick wall will be 110mm wide. 55mm of the wall will be on your side and 55mm of the wall will be on my side. I am not asking for a contribution towards the cost of the wall, as I will pay for it. The builder has assured me that during the replacement process, he will ensure that it is "dog safe". Do I have you permission to proceed? Could you please let me know ASAP" 1. the email sent on 27 March 2018 at 1.17pm by Mr Fitzmaurice to the owner with the subject "Boundary fence" (the 27 March 2018 at 1.17pm email) in which he relevantly stated: "Yes, sounds great. …"

[36]

Consideration

Pursuant to cll 3(a) and 9(a) of the general conditions the builder was required to build the works in accordance with the plans and specifications set out in the contract. Further, pursuant to cl 20 of the general conditions the builder was required to build the works so that they did not encroach on the adjoining properties.
I am not satisfied in view of the opinions of Messrs Jamieson and Lee In the joint building report that the external paving was not defective.
I am satisfied in view of the opinions of Messrs Jamieson and Lee In the joint building report that the insulation was defective in not complying with the provisions of the contract set out in the 1 March 2019 letter.
I am satisfied that the bathroom ceiling was defective because it did not comply with the owner specifications by reason of not being built with "Aquachek 13mm". The builder was not entitled to substitute a different brand of water resistant plasterboard for the specified product.
I am satisfied that the tiling without channels in the bathroom so as to permit the shower screen to be channel-set was defective because it did not comply with the AK specifications. The builder was not entitled to ignore the contract because he regarded a channel-set shower screen as not being good building practice.
I am not satisfied that either the front brick wall on the common boundary between the property and the adjoining property on the northern side and parts of the building works encroached on either adjoining properties in breach of cl 20 of the general conditions. The document described as a survey attached to the 29 March 2019 letter is inadequate to establish any encroachments as it was prepared by an unidentified person.
On the proper construction of the contract the builder had an obligation to remedy defects in the following situations: 1. pursuant to cl 8 of the general conditions if having notified the owner the work was complete, he received within 10 days' notice from the owner of items the owner considered to be defective. In this situation the builder would be required to remedy the defective items promptly; 2. pursuant to cl 23 of the general conditions in respect of defects which become which become apparent within the period of 13 weeks from the date of completion. In this situation the builder would be required to remedy the defective items within 30 business days of receipt of notification from the owner; 3. pursuant to cl 23 of the general conditions in respect of major defects which become apparent before the date of completion. The nature of the further defects liability period for such major defects is that the builder would be required to remedy the defective items within 30 business days of receipt of notification from the owner which may be made up to the date being 13 weeks from the date of completion. It is implicit that the obligation to rectify only arises after the date of completion.
While the expression "major … defects in the work" in cl 23 of the general conditions is not defined in the contract, I am satisfied that the defect relating to insulation referred to in the 1 March 2019 letter was such a major defect because its rectification involved removing and replacing the insulation and batons beneath a 54m2 iron roof. I am also satisfied that by the 1 March 2019 letter the owner gave notice of this defect to the builder, and that this letter was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions. However, the builder was under no obligation to rectify this defect under either cl 8 or cl 23 of the general conditions because the date of completion within cl 8 of the general conditions had not been reached.
I am not satisfied that the defect relating to the bathroom ceiling and the tiling without channels in the bathroom referred to in the 29 March 2019 letter was a major defect in the works within cl 23 of the general conditions. I am satisfied that the 29 March 2019 letter was an effective notice for the purpose of the first paragraph of cl 27 of the general conditions of these defects. However, the builder was under no obligation to rectify this defect under either cl 8 or cl 23 of the general conditions because the date of completion within cl 8 of the contract had not been reached.
I am not satisfied that the builder had failed to rectify the defective insulation, the bathroom ceiling and the tiling without channels in the bathroom as at 5 April 2019 because at that time he had no obligation to do so.
It follows that I am not satisfied that the owner has established that the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019.

[41]

The correspondence between the parties

On 5 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the 5 April 2019 notice in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder is In default under the Contract In that: 1. The Builder is failing to diligently proceed with the work under the Contract (Works): a. The time for completion of the Works was 8 November 2018, extended by valid extension of time claims by the Builder until 11 December 2018, however the Works are not yet complete; b. The Builder failed to notify the Owner of the causes and estimated lengths of any delays within ten (10) business days of ^e occurrence of the delay, In order to comply with the requirements for extension of time claims under clause 7 of the Contract; c. The Builder has been sporadically carrying out the Works since January 2019 In a piece-meal fashion; and d. The Builder has failed to communicate directly with the Owner since 21 February 2019, insisting that all communication be through the Builder's solicitor, and this has caused further delays to the Works. 2. The Builder has failed to remedy defects In the Works or remove faulty or unsuitable materials used in relation to the Works: a. By a "Notification of Defects" dated 1 March 2010, the Owner advised the Builder of the following defects and non-compliant materials in the Works: i. Incorrect fall in external paving; and ii. Insulation which is not compliant with the Contract. b. The Owner requested a response to the above issues by 5:00pm 5 March 2019. The Builder advised he would respond by 8 March 2019 however no such response was received. c. By a "Notification of Defects" dated 29 March 2019, the Owner advised the Builder of the following defects and non-compliant materials In the Works; i. Incorrect fall in external paving; ii. Insulation which Is not compliant with the Contract; iii. Defective bathroom celling; iv. Defective tiling In the bathroom, which will prevent the shower screens from being "channel-set" until the tiling is rectified; and v. Encroachments over the boundary caused by the Works. d. The Owner requested a response to the above issues from the Builder, including a timeline for proposed rectification works, by 5;00pm 1 April 2019, however no such response was received. e. The Builder has failed to remedy defects in the Works or replace or rectify unsuitable materials used in the Works, despite requests by the Owner. FURTHER, THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract that If the Builder does not remedy the defaults described above within ten (10) business days then, without prejudice to the Owner's rights, the Owner may terminate the Contract."
In the 8 April 2019 letter the builder's lawyers claimed pursuant to cl 7 of the general conditions an extension of time of 305 days under the contract, and relevantly stated: "We refer to your letter of 29 March 2019, and are instructed to reply as follows, … … GARAGE DOOR - VARIATION TO CONTRACT We note in the attached email received from your client on 1 April 2019, that she has approved the design of a new garage door and paid the 50% deposit to Deville Garage Doors, for the same. The garage door specified in the contract was a B&D roller door Squareline (Monument) with control-A-door power drive. Your client ordered a new door, and thereby varied the contract. EXTENSION OF TIME Our client notes the variation, and seeks an extension of time pursuant to clause 7 of the contract from 12 December 2018, until the delivery and installation of the new garage door, ordered by your client on 1 April 2019. In any event the delay from 12 December 2018 to 1 April 2019, with further days to be claimed once the door has been delivered and installed, is set out as follows: BUILDERS EXTENSION OF TIME CLAIMS Delay Cause of delay Period Revised date for practical completion No Commencement 1 March 2018 date Original date of Practical completion 8 November 2018 Extension of Time Claimed

                                       Correction of structural plans                                                                                                         5 business days       15 November 2018

                                       Re-location of floor                                                                                                                   5 business days       22 November 2018
                                       wastes

                                       New window / door supplier                                                                                                             34 business days      18 January 2019

                                       Police suspension of works 14 December 2018                                                                                            48 business days      27 March 2019

                                       Christmas shut down: 25.12.18-1.1.19                                                                                                   6 business days       4 April 2019

                                       Australia day holiday                                                                                                                  1 business day        5 April 2019

                                       Unavailability of kitchen manufacturer to supply doors 7.12.18-20.1.19 21.1.19-21.2.19                                                 44 business days      6 June 2019

                                       Non-selection of paint colours by owner 31.1.19-21.2.19                                                                                15 business days      27 June 2019

                                       Rain days                                                                                                                              10 business days      11 July 2019

                                      Delay caused by owner's stone floor suppliers and installers                                                                           8 business days       23 July 2019

                                      Inability to carry bathtub delivered on 25 February 2019, to upstairs bathroom, due to inadequate width of stairs or size of bathtub.  9 days and ongoing    5 August 2019

                                      Delay in delivery of tapware and fixtures and fittings                                                                                 7 days                14 August
                                                                                                                                                                                                   2019

                                      Delay caused due to change in front door previously approved by Owner and door hardware.                                               10 Days and ongoing   28 August
                                                                                                                                                                                                   2019

14 Change to garage door selection by Owner on 1 April 2019, 110 days and ongoing 16 December 2019 Period of delay 11 December 2018, to 1 April 2019 Total 305 days Revised date for practical completion 16 December 2019

[42]

Pursuant to clause 7 of the contract our client claims an extension for the reasons stated above and as notified, fi-om 9 November 2018 until 16 December 2019. Given the above our client anticipates that a revised date for practical completion of the work will be on 16 December 2019, noting that your clients home will be reasonably capable of being used, in accordance with clause 8 of the contract before that date due to our client's diligent work, which continues on site, despite your client's contentions."

On 11 April 2019 at 2.12pm, Mr Tengstrom sent an email to the owner and the builder in which he stated that the absence of LED lights was adding to the time delays (the 11 April 2019 at 2.12pm email): "Just a reminder that we need the led lights asap please stress to the supplier that there mistake needs to be rectified immediately as this adds to the time delays. Also the guest bedroom bulkhead needs to be removed to remove the led lights and will need to stay that way until the lights arrive this will stop the joiners, air conditioning grills and painters from finishing the room."
On 11 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the document entitled "owner's notice disputing builder's claim for extension of time" (the 11 April 2019 notice) in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 7 of the Contract that the Owner disputes the Builder's claim for extensions of time to complete the works under the Contract as outlined in the letter from Wilkinson Building & Construction Lawyers Pty Ltd dated 8 April 2019, on the following grounds: Delay Business Days No Alleged cause of delay days Owner's comments agreed claimed

Correction of structural plans                                                                                                            5               Extension of time accepted                                                                                                                                                                                                                                                                                                                                                                                                                                                    5

Re-location of floor wastes                                                                                                               5               Extension of time accepted, although 5 business days is generous                                                                                                                                                                                                                                                                                                                                                                                                              5
                                                                                                                                                          Extension of time not accepted.

New window/door                                                                                                                           34              The window delay was caused by the manufacturer "Aneeta", not the nominated supplier, "Lifestyle Glass". Aneeta carry out the installation of ail their windows therefore the original supplier, "Iconic", would have also been delayed by Aneeta.                                                                                                                                                                                                                            7
supplier                                                                                                                                                  Iconic carried out a final check measure on 26/07/18 and Lifestyle Glass carried out their final check measure on 1/08/18. The delay caused by the change in window supplier was therefore 7 business days.
                                                                                                                                                          The Owner is not responsible for delays caused by the Builder's subcontractors and suppliers - any such delay is a matter between the Builder and the third party.
                                                                                                                                                          Extension of time not accepted.
                                                                                                                                                          On 14 December 2018 the Builder caused the plasterers to sand the walls and the timber floors to be laid (on incorrect frame) simultaneously with the painters painting the walls. This was ruining the finish of the painting and was dearly a sequencing problem which would mean the painting would have to be re-done. In order to mitigate loss (of either party) the Owner raised the issue with the Builder, which caused him to become aggressive towards the Owner.

Police suspension of works 14 December 2018                                                                                               48              On 14 December 2018 at 7:26am the Builder threatened the Owner on site, raising his clenched fist to the Owner's face and saying words to the effect of; "If you were a man, 1 would punch you in the face".                                                                                                                                                                                                                                                                  0
                                                                                                                                                          Furthermore, the Builder threatened to cause damage to the Owner's property, saying words to the effect of: "/ will make sure that you never get to move into your house. 1 will smash it all down."
                                                                                                                                                          As such, the police assistance sought by the Owner was, without a doubt, warranted and due to the fault of the Builder. The Builder was locked out by the Owner from approximately 5:45pm on Friday 14 December 2018 until 6;00am Tuesday 18 December 2018, which is a total of one (1) working day. The Builder chose not to carry out any further work at the site until 14 January 2019.
                                                                                                                                                          The Builder's assertion that a delay of 48 business days ensued following the police intervention (which in itself was the result of threatened violence by the Builder) is utterly absurd and without merit.

Christmas shutdown                                                                                                                        6               Extension of time is accepted.                                                                                                                                                                                                                                                                                                                                                                                                                                                6
                                                                                                                                                          Although, If the Builder had carried out works under the Contract with due diligence and completed works by Christmas as he was contractually obliged to do, the Christmas shut down period would not have been in any way relevant.

Australia Day Holiday                                                                                                                     1               Extension of time is accepted.                                                                                                                                                                                                                                                                                                                                                                                                                                                1
                                                                                                                                                          Although, if the Builder had carried out works under the Contract with due diligence and completed works by Christmas as he was contractually obliged to do, the Christmas shut down period would not have been in any way relevant.
                                                                                                                                                          Extension of time not accepted.

Unavailability of kitchen manufacturer to supply doors                                                                                    44              There was no meeting with the joiner scheduled for 7 December 2018. The Owner received a text message at 7;33am on 7 December 2018 from the foreman saying: "Can you come in this morning?" however the Owner was not available. No meeting with the joiner was "cancelled" by the Owner.                                                                                                                                                                                     0
                                                                                                                                                          The Builder failed to ensure the joiner proceeded with due diligence and the resulting delay is the fault of the Builder.
                                                                                                                                                          The Owner is not responsible for delays caused by the Builder's subcontractors and suppliers - any such delay is a matter between the Builder and the third party.

Non-selection of paint colours by owner                                                                                                   15              Extension of time not accepted.                                                                                                                                                                                                                                                                                                                                                                                                                                               0
                                                                                                                                                          The paint colours are specified by AKD and are already part of the Contract. No selection by the Owner is required and, as such, the extension of time claim is unsubstantiated and illogical.
                                                                                                                                                          Extension of time not accepted.

Rain days                                                                                                                                 10              The Contract provides at clause 7; "Both the contractor and the owner (if applicable) must take all reasonable steps to minimise any delay to the work". Furthermore, the work as a whole must be affected by the delay and the critical path of construction activity interrupted.                                                                                                                                                                                           0
                                                                                                                                                          The Builder could have carried out internal work on rain days.
                                                                                                                                                          Extension of time not accepted.

Delay caused by owner's stone tile floor suppliers and installers 8 Pursuant to the Contract the Owner is to supply only the stone tile flooring. 0 There was no delay in the Owner supplying the stone flooring. The delay has been due to the Builder and/or his installer. In or about mid-August 2018 the Owner suggested to the Builder that the bathtub be transported upstairs through a window opening before the windows were installed. The Builder advised the Owner (with full knowledge of the dimensions of the bathtub and the stairs), that the Builder would be able to get the bath up the stairs.
Inability to carry bathtub delivered on 25 February 2019, to upstairs bathroom, due to inadequate width of stairs and or size of bathtub 9 and ongoing Furthermore, the Builder had full knowledge of the dimensions of the bathtub and stairs prior to signing the Contract. Pursuant to clause 19 of the Contract, "the contractor must bear all costs involved in the delivery of materials to the work, handling of materials...'' 0 in any event, the Builder contacted a removalist company on 13 March 2019 and arranged for the bath to be moved on 14 March 2019. The Owner's position is that the Builder should have done this earlier in order to avoid any possible delay to the work. The delay was therefore caused by the Builder.
Delay in delivery of tapware and fixtures and fittings The delay was caused by the Builder. On 22 February 2019 the Owner provided the site foreman the details of the supplier of the tapware and fixtures and fittings for the Builder to arrange delivery. Builder made no contact with the supplier until 5 March 2019, after which the supplier emailed the Owner advising a delivery date had been arranged. 0
Delay caused due to change in front door previously approved by Owner and door hardware 10 and ongoing The Owner denies changing the front door "previously approved". The door specified in the Contract is a $830 "Sydney Woodworkers" door. The Builder and the Owner held discussions in which the Builder recommended the installation of a $500 "Doors Plus" door however the Owner advised the door specified in the Contract must be installed. 0 No delay was caused by the Owner in changing the specification of the garage door. 14.* Change to garage door selection by Owner on 10 and ongoing The Owner advised the Builder of the garage door required by the Owner (which was within the Builder's allowance in the Contract for the garage door) on 4 December 2018, however the Builder failed to order the door. 0 1 April 2019. Period of delay 11 December 2018, to 1 April 2019 There is a three-week lead time on both the garage door specified in the Contract and the door requested by the Owner on 4 December 2018 and the Builder was responsible for ordering the door in a timely manner to avoid any delay to the works. The Owner paid the deposit for the garage door to confirm the order on 8 April 2019 in order to mitigate the delay because the Builder had still not confirmed the order by that date. TOTAL 305 24

[43]

*Only new item Further to the above, the Owner gives notice that; A. Some of the delays alleged by the Builder are concurrent delays. For the Builder to simply add up the number of days the works were allegedly delayed by, after various events occurred, is without contractual basis and results in an untenable position of the Builder. B. Importantly: i. the Builder previously issued claims for extensions of time on 31 January 2019 and 12 March 2019, which collectively contained items (1) to (13) above. ii. the Owner responded to the Builder's claim for extensions of time dated 31 January 2019 by notice served on the Builder on 7 February 2019 and In that response addressed items (1) to (10) above; iii. the Owner responded to the Builder's claim for extensions of time dated 12 March 2019 by notice served on the Builder om 15 March 2019 and in that response addressed items (11) to (13) above; iv. the Builder has failed to acknowledge that the Builder's previous extension of time claims are without basis and has simply repeated those claims on 12 March 2019 and 8 April 2019. C. The date for practical completion in the Contract is 7 November 2018. With an extension of time of 24 business days as accepted by the Owner the works under the Contract were due to be completed by 11 December 2018. D. The Builder's claim for extensions of time until 16 December 2019 is strenuously rejected by the Owner and held to be wholly unsubstantiated. The Owner requires the Builder to proceed with the works under the Contract with due diligence and without further delay. E. The Owner reserves her rights in respect of claiming delay damages from the Builder, including loss of rent arising from an inability to lease the dwelling, and storage costs arising from being unable to furnish the dwelling, since the date for completion under the Contract."

On 16 April 2019 at 8.37am, Mr Tengstrom sent an email to the owner and the builder in which he requested her to get Sydney Tap to contact her when they received the handle so that he could book in the plumber (the 16 April 2019 at 8.37am email).
On 24 April 2019, the owner's lawyers sent a letter to the builder's lawyers enclosing the 24 April 2019 notice in which the owner relevantly stated: "THE OWNER GIVES NOTICE pursuant to clause 25 of the Contract, that the Builder has failed to remedy his breaches of the Contract, such breaches being notified to the Builder in writing by Notice of Default dated 5 April 2019: 1. The Builder is failing to diligently proceed with the work under the Contract (Works); and 2. The Builder has failed to remedy defects in the Works and remove faulty or unsuitable materials used in relation to the Works; FURTHER, THE OWNER GIVES NOTICE to the Builder pursuant to clause 25 of the Contract that the Contract is hereby terminated. FURTHER AND IN THE ALTERNATIVE, THE OWNER GIVES NOTICE that the Builder has demonstrated that the Builder cannot complete the Works within the time agreed under the Contract, namely 36 calendar weeks from the date referred to in Clause 5 of the Contract (1 March 2018), adjusted in accordance with the terms of the Contract, and such timeframe is an essential term of the Contract. The Owner gives notice that she exercises her common law right to terminate the Contract."
In the 6 May 2019 letter the builder's lawyers relevantly stated: We refer to your client's purported Notice of Termination dated 24 April 2019, and are instructed to reply to that purported notice as follows: No Basis for Termination & Defective Notices There is no basis for the purported termination, and the purported termination notice is defective on the following grounds; 1. On 29 March 2019, your client demanded the rectification of defects other than in accordance with contract Clause 23. This demand was premature, as clause 23 deals with defects and the time for the same to be rectified. Your client has 13 weeks from the date of completion which is defined in clause 8, of the contract. 2. Following the letter dated 29 March 2019, your client has then purported to issue a Notice of Default. That notice is dated 5 April 2019, and is defective in that it seeks to engage Clause 23 of the Contract in circumstances where to do such is entirely premature. The second part of the notice relies on the proposition that the Builder has failed to proceed diligently with the work. This is a factual matter and would no doubt be the subject of evidence. That said because your client has introduced prematurely the "Notification of Defects" the entirety of the notice is defective. 3. In a further letter dated 12 April 2019, your client makes reference to Clause 23 of the Contract, which states in the margin note that; defect rectification is not to be used to finish items of work that should have been completed. 4. The suggestion that work is not being done belies the correspondence with the Builder. See for example the email from the Builder to the Owner dated 28 March 2019, copy attached. 5. On 11 April 2019, there then appears to be a purported notice issued by your client pursuant to Clause 7 of the Contract disputing the extension of time claimed by the Builder. This then requires the matter in the absence of agreement to be dealt with in accordance with Clause 27 (Dispute Resolution), That has not occurred. 6. Finally, your client has issued a purported Notice of Termination pursuant to Clause 25 of the Contract. The purported Termination Notice is defective because it proceeds on two (2) erroneous bases, one of which is patently wrong, namely item 2 which is directed at the "completion of work" that is only engaged in Clause 23 of the contract and self-evidently permits a Defects rectification period of 13 weeks. That time has not commenced and the mechanism in the contract has not been followed. Builders Acceptance of Repudiation by Owner We hereby advise and give notice that your client's conduct amounts to a repudiation of the contract, and our client accepts that repudiation and will now sue her for the loss and damages suffered which arise from her repudiatory conduct in accordance with the contract terms. We otherwise reserve all of our client's rights, including the tendering of this letter on any issue including costs."

[46]

Consideration

I have found that that the owner has established that the builder failed to proceed with the works diligently in breach of the contract as at 5 April 2019. As this default could have been remedied, and the 5 April 2019 notice stated unless the default was remedied within 10 business days the owner will terminate the contract, then I am satisfied that this notice so far as this default as specified in paragraph 1(a) and (c) was a valid notice within cl 25 of the general conditions. I have found that the owner had on 18 January 2019 and 20 February 2019 notified the builder of the dispute about his failure to proceed diligently with the works with the first paragraph of cl 27 of the general conditions. There was no requirement that the owner invoke the dispute resolution mechanism in the second and/or third paragraphs cl 27 of the general conditions before a valid notice could be issued under cl 25 of the general conditions as these paragraphs on their construction give the parties a discretion whether or not to invoke the mechanism.
I have found that that the owner has not established that the builder failed to remedy defective work or remove faulty or unsuitable materials in breach of the contract as at 5 April 2019. It follows that I am not satisfied that this notice so far as any of the defaults as specified in paragraph 2 was a valid notice within cl 25 of the general conditions because the precondition of the giving of a notice under this clause, being the builder "fails to remedy defective work or remove faulty or unsuitable materials", had not been satisfied.
I am satisfied that the builder did not comply with the owner's request to remedy the default of failing to proceed with the works diligently within 10 business days of 5 April 2019, being 19 April 2019 having regard to the definition of "business day" in cl 30 of the general conditions, by reason that the only evidence of any further progress with the works was the request made to the owner in the 16 April 2019 at 8.37am email. This request was inadequate to demonstrate that the builder had remedied this defect. The other communication by the builder in this period in the 11 April 2019 at 2.12pm email did not constitute any further progress with the works.
As the builder did not comply with the owner's request to remedy the default of failing to proceed with the works diligently by 19 April 2019, then I am satisfied that the owner by the 24 April 2019 notice validly terminated the contract under its terms.
As the owner validly terminated the contract under its terms on 24 April 2019, I reject the submission of the builder that the owner by the 24 April 2019 notice repudiated the contract.

[50]

The applicable legal principles

The term repudiation is used in different senses. First, it may refer to conduct which evinces an unwillingness, or an inability, to render substantial performance of the contract. This is sometimes described as conduct of a party which evinces an intention no longer to be bound by the contract or to fulfil it only in a manner substantially inconsistent with the party's obligations. It may be termed renunciation. The test is whether the conduct of one party is such as to convey to a reasonable person, in the situation of the other party, renunciation either of the contract as a whole or of a fundamental obligation under it. Secondly, it may refer to any breach of contract which justifies termination by the other party. There are two relevant circumstances in which a breach of contract by one party may entitle the other to terminate. The first is where the obligation with which there has been failure to comply has been agreed by the contracting parties to be essential. Such an obligation is sometimes described as a condition. It is the common intention of the parties, expressed in the language of their contract, understood in the context of the relationship established by that contract and the commercial purpose it served, that determines whether a term is "essential", so that any breach will justify termination. The second relevant circumstance is where there has been a sufficiently serious breach of a non-essential term. Such an obligation is sometimes described as an intermediate term. Breaches of this kind are sometimes described as "going to the root of the contract". A judgment that a breach of a term goes to the root of a contract, which has been described "such as to deprive the injured party of a substantial part of the benefit to which he is entitled under the contract", rests primarily upon a construction of the contract. A question as to contractual intention, considered in the light of the language of the contract, the circumstances in which the parties have contracted and their common contemplation as to future performance, is different from a question as to the intention evinced by one of the parties at the time of breach, such as arises in cases of alleged renunciation: Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115 (Koompahtoo) at [44]-[56]; [2007] HCA 61.
In Lawrence v Ciantar; Ciantar v Lawrence [2019] NSWSC 464 (Lawrence) at [191] and [201] Henry J said: "[191] The general rule is that breach of an intermediate non-essential time term of a contract does not give rise to a right to terminate unless a party first serves a notice requiring performance within a reasonable time. The exceptions to this are where there is unreasonable delay in performance or anticipated failure to comply with a notice to perform. Unreasonable delay occurs where the delay evidences a repudiation of the obligation by the promisor: see JW Carter, Contract Law in Australia (7th ed, 2018, LexisNexis Butterworths) [30.54 - 30.56]. … [201] The relevant question is whether the evidence outlined above establishes that Mr Lawrence's delay in completing the DA works was sufficiently unreasonable to evince repudiation by him of his obligations under the contract."

[55]

Introduction

The parties proceeded on the basis that any items of defective work constituted a breach of cl 9(a) of the general conditions and the statutory warranties implied in the contract pursuant to s 18B(1)(a) of the HB Act.
The parties reached agreement in the joint building report as to the items which were defective, the scope of works for the rectification of the defective items, and the reasonable cost of rectifying these items exclusive of GST: 1. item 2.1 - courtyard planter box - waterproof membrane: $2,211.00; 2. item 2.2 - courtyard planter box - waterproof membrane: $190.00; 3. item 3 - carport - door & lock: $857.50; 4. item 4 - carport - timber framed walls: $1,678.00; 5. items 5.1 - living room - bifold doors: $259.00; 6. items 5.2 - living room - bifold doors: $587.50; 7. item 6 - windows: $1,310.00; 8. item 7 - windows - fly screens: $1,544.00; 9. item 8 - main bathroom - cracked tile: $285.00; 10. item 9 - internal paint finishes: $4,984.00; 11. item 10 - laundry door: $300.00; 12. item 11.3 - first floor addition - lack of plasterboard in roof cavity: $2,390.00; 13. item 13 - skylights: $2,250.00; 14. item 15 - main bathroom joinery unit drawers: $294.00.
By reason of the agreed position of the parties set out at [28(1)] and [228] above it is only necessary to determine the items that remain in dispute.
The dispute between the parties as to the remaining items was as to one or more of the questions whether the item was defective, and where it is found to be defective the method of rectification the reasonable amount to rectify the item where it is found to be defective. The builder in his various written submissions and his oral submissions did not make any submission that the rectification of any item found to be defective was an unreasonable course to adopt.
For each item that remains in dispute I have summarised the evidence and submissions of the parties, and then considered the item. Before considering the items that remain in dispute I have summarised the evidence of the parties, and considered the rate for labour, and the time, that should be allowed to rectify defective works.

[107]

The application of s 48MA of the HB Act

In Kurmond Homes Pty Ltd v Marsden [2018] NSWCATAP 23 (Kurmond) at [42]-[46] and [55] the Appeal Panel identified the following five factors relevant to the nature of the obligation imposed on the court or tribunal by s 48MA of the HB Act: 1. first, the principle, by its terms, only applies "in determining a building claim involving an allegation of defective residential building work or specialist work". It is not expressed to apply where, for example, the building claim only involves an allegation of incomplete residential building work or specialist work. That is not to suggest s 48O does not otherwise permit a work order in respect of work found to be incomplete; 2. second, s 48MA is directed towards the remedy or "outcome" to be provided by the court or tribunal where a claimant establishes the responsible party has carried out defective residential building work or specialist work. In this sense, it is not properly described as a "presumption". Rather, it is a remedy to be "preferred" to other forms of order which the court or tribunal might make; 3. third, while s 48MA provides 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 section does not mandate that a work order must be made in all cases. Further, the section does not confine the form of orders that may be made under s 48O, including an order that defective work be rectified by the responsible party engaging another person to carry out that work on behalf of the responsible party; 4. fourth, the term "preferred" is not defined. The HB Act and the Home Building Regulation 2014 (NSW) do not specify circumstances in which the preferred outcome is not to be adopted. However, guidance as to the meaning of "preferred" and the circumstances that would justify an order for a different outcome is found in the second reading speech where the Minister for Fair Trading makes clear that the purpose of the amendment (New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 6 May 2014) was to: "(1) prevent a homeowner from unreasonably refusing a builder access to a building site to rectify defective work; (2) permit a builder to return to carry out necessary rectification work if they are willing; and (3) support the timely and cost-effective resolution of disputes." That is, in deciding what order should be made, a court or tribunal may consider whether there is a reasonable basis for any objection raised by the homeowner to the builder being permitted to rectify the defective work, the terms of any order, whether the builder is willing to return and whether such an order would support a timely and cost effective resolution of the dispute; 1. fifth, the fact there is a dispute which has necessitated the commencement of proceedings by an aggrieved homeowner is not of itself sufficient to justify the Tribunal in departing from an application of the preferred outcome principle in s 48MA.
In Clements v Murphy [2018] NSWCATAP 152 (Clements) at [31] the Appeal Panel held that where a building contract has been terminated prior to completion of the work by reason of the builder's repudiation, it would be unusual for the Tribunal to direct the builder to return to complete the work. On its true construction, s 48MA does not require the Tribunal to consider that that should be the preferred outcome.

[113]

Introduction

The parties reached agreement as to the items in which were incomplete, and the reasonable cost of completing these incomplete items exclusive of GST: 1. item 40 - A1 - boundary wall Pearl Lane blueboard not masonry: $211.00; 2. item 42 - A4 - semi recessed HWS not recessed: $436.00; 3. item 43 - A5 - rendering ground floor walls plasterboard not render: $706.00; 4. items 44 and 45 - A6 - ground floor shower screen channel fix, and bracket fix: $169.00; 5. item 46 - timber feature around kitchen not erected: $799.00; 6. item 49 - incorrect insulation to internal walls: $430.00; 7. item 50 - storage room door not installed: $814.00; 8. item 51 - B1 - site surveyor set out not done: $680.00; 9. item 52 - B2 - site surveyor final not done: $340.00; 10. item 53 - B4 - servo drive unit only for d/w panel: $250.00; 11. item 54 - B5 - tip on legrabox runners 500mm long: $234.00; 12. item 55 - B6 - 3 x blum aventos lift up doors where shown: $419.00; 13. item 56 - B7 - blum motion movento runners with tip on to base cabinet: $130.00; 14. item 57 - B8 - LED ally channel recessed to cabinet soffit panel not recessed: $107.00; 15. item 58 - B9 - LED ally recessed to soffit panel of s/c only not recessed: $160.00; 16. item 59 - B10 - LED ally strip recessed where indicated not recessed: $438.00; 17. item 62 - B13 - LED strip to top of cabinet ally channel to be recessed: $320.00; 18. item 63 - B14-B22 - storage room robe not built: $2,588.00; 19. item 64 - B23 - push to open doors: $78.00; 20. item 67 - B26 - supply and install PIR sensors to ech robe and WIR: $477.00; 21. item 68 - B27 - supply and install digital 24/7 D/S timer for lighting: $629.00; 22. item 69 - B28 - supply and install external PIR for lighting: $270.00; 23. item 70 - B29 - supply and install flush mounted Clipsall smoke detector: $84.00; 24. item 71 - B30 - supply and install Clipsall 2000 light switches to suit lighting lay-out: $234.00; 25. item 72 - B31 - supply and install 10 x Clipsall universal dimmers: $880.00; 26. item 73 - B32 - PC allowance for door furniture: $450.00; 27. item 82 - Deville garage doors: $1,981.82; 28. item 83 - Richard Knight plumbing invoice 6200: $1,150.00; 29. item 85 - Palmers Glass: $3,830.00; 30. item 86 - Glenco Electrics Inv. 1909028: $4,230.00; 31. item 91 - Glenco Electrics Inv. 1909331: $1,410.45; 32. item 94 - Glenco Electrics Inv. 141200: $130.00; 33. item 95 - Richard Knight plumbing invoice 6233: $1,050.00; 34. item 96 - Denman painting and wallpaper: $200.00; 35. item 97 - Glenco Electrics Inv. 2000044: $170.00; 36. item 98 - Glenco Electrics Inv. 143305: $218.00; 37. item 99 - Glenco Electrics Inv. 139002: $170.00; 38. item 100 - Hafele ailo Euro Cargo ST45 x 1: $542.00; 39. item 101 - Richard Knight plumbing invoice 6318: $890.00; 40. item 102 - Glenco Electrics Inv. 20269: $290.00.
By reason of the agreed position of the parties set out at [28(3)], [28(5)] and [292] above it is only necessary to determine the items that remain in dispute.
For each item that remains in dispute I have summarised the evidence and submissions of the parties, and then considered the item.
The builder made submissions relating to items 76 and 87 that the owner conceded that these items were not part of the contractual scope of works. By reason of my rejection of the tender of the third Mullally affidavit (MFI 1), there was no such concession by the owner. I have not dealt with this submission in my consideration of each of items 76 and 87. In any event, the question of whether any items are part of the contractual scope of works involves the construction of the contract and is not answered by reference to the subjective view of the owner.
The builder also made submissions relating to items 65, 75, 79, 80 and 88 of the amended scott schedule that because of their omission from the Contract Inclusions document they should be taken have been withdrawn by the owner. I am not satisfied that the omission of these items from the Contract Inclusions document constitutes a withdrawal of these items. No such concession was made by the owner. I have not dealt with this submission in my consideration of each of items 75, 79, 80 and 88.

[179]

The submissions of the builder

In the builder's 16 July 2021 submissions, the builder's 20 August 2021 submissions and his oral submissions the builder made the following submissions about the items in the Touchwood invoice: 1. fix magnet catch ($50.00): this item was not part of his scope of works, and the owner has not indicated where in the contract this item emanates from; 2. gyprock and frame wall in the laundry ($1,400.00): these works were not part of his scope of works, and relate to variation # 13, which the owner disputes. The laundry works were completed and after completion the owner sought a change which resulted in variation # 13, which she has not approved and disputes. Despite this she now claims for the costs of completing the varied works; 3. replace damaged gyprock ceiling in the upstairs bathroom with aqua check ($1,200.00): This would be a defect which would have been attended to during the defect's liability period; 4. cavity slider door white on both sides ($200.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 5. cavity slider door and running guides and push pull handle ($150.00): the owner wrongfully terminated the contract before he was able to complete these works; 6. caulk gap around shelves ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 7. adjust front door striker ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose; 8. install door handle and strike ($50.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 9. repair front window that didn't open ($50.00): the window was existing and was not part of his scope of works. The owner has failed to identify where this item arises in the contract; 10. install new window lock ($100.00): the window was existing and was not part of his scope of works. The owner has failed to identify where this item arises in the contract; 11. cavity slider door and running guides and push pull handle in laundry ($150.00): this item is a minor defect, and the amount claimed is excessive and unreasonable. The owner wrongfully terminated the contract before the defect's liability period arose, or the builder was able to complete the works; 12. install 2 doors under the stairs ($400.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 13. install side wall next to laundry tub ($300.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 14. painting walls and doors under stairs ($300.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 15. remove ac grill ($50.00): the owner has withdrawn this item; 16. paint sewer pipe vent ($50.00): the owner has failed to indicate where this item is in the contract, and it is not part of his scope of works; 17. floor protection ($200.00): he had previously provided floor protection, and no explanation is provided as to why this item is required and for what purpose it was used and when; 18. removal of tiles and new sheeting to have the toilet raised up ($300.00): the works were performed by him to the manufacturer's instructions; the owner approved the location of the toilet prior to it being installed and has now changed her mind. The builder should not be responsible for the design change sought by the owner after the works were completed and in circumstances where the owner wrongfully terminated the contract and has changed her mind about the location of the toilet; 19. extra paint needed for internal works as the old cans ran out ($200.00): no explanation, or detail as to what external works were performed which required the extra paint is provided by the owner; the tin of paint is alleged to have costs exactly $200, with no evidence substantiating this item. Further and in the alternative the ongoing provision of paint was not part of his scope of works. The owner is seeking $649.00 for painting by Denman Painting and Wallpaper Pty Ltd, which presumably would have been undertaken by the licenced painter, not Touchwood.

[180]

The submissions in reply of the owner

In the owner's 15 September 2021 submissions the owner replied to the builder's 16 July 2021 submissions: 1. there is no evidence to the effect that the builder provided a handrail and the submission is contrary to the evidence of the builder. Nor is there any evidence to support the submission that "the owner changed her mind and requested a recessed handrail". There is no evidence that the builder held an opinion that a recessed handrail was not compliant with the BCA. The builder claimed the handrail could not be recessed because the wall was masonry. Touchwood has recessed the handrail into a gyprock wall and the joinery detail shows a plasterboard wall; 2. in respect to the other items, her evidence that such items are part of the scope of works should be accepted; 3. fix magnet catch ($50.00): the builder installed joinery with magnet catches; 4. gyprock and frame wall in the laundry ($1,400.00): this work did not relate to variation # 13. The laundry was required to be framed and sheeted with plasterboard in common with the rest of the new work as shown on drawing DA.1001 of the PW plans; 5. replace damaged gyprock ceiling in the upstairs bathroom with aqua check ($1,200.00): the owner was entitled to have the ceiling replaced because it was damaged and was not Aquacheck as specified in the contract; 6. cavity slider door white on both sides ($200.00): this door is shown on drawing AKD-002 of the AK specifications as the door from bedroom 2 to the walk in robe; 7. cavity slider door and running guides and push pull handle ($150.00): the owner had the work done by Touchwood and is entitled to recover what was spent; 8. caulk gap around shelves ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 9. adjust front door striker ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 10. install door handle and strike ($50.00): there is no evidence that the amount of $50.00 for this item is excessive; 11. repair front window that didn't open ($50.00): the front window was an existing window. It was painted by the builder. Touchwood repaired the window after painting; 12. install new window lock ($100.00): Touchwood installed a new window lock at a cost of $100.00; 13. cavity slider door and running guides and push pull handle in laundry ($150.00): the cavity slider door is shown on drawings AKD-001 and AKD-100 of the AK specifications as the door between the ground floor bathroom and the laundry. There is no evidence that the amount of $150.00 for this item is excessive; 14. install 2 doors under the stairs ($400.00): the doors under the stairs are shown on drawing AKD-001 of the AK specifications; 15. install side wall next to laundry tub ($300.00): new framed and gyprocked walls are shown alongside the tub on drawing DA.1001 of the PW plans; 16. painting walls and doors under stairs ($300.00): drawing AKD-007 of the AK specifications shows painting in the laundry; 17. paint sewer pipe vent ($50.00): the builder does not deny that this item is part of the contract works; 18. floor protection ($200.00): the work carried out by Touchwood was after termination, but whoever carried out the work would have required floor protection; 19. removal of tiles and new sheeting to have the toilet raised up ($300.00): the builder has agreed to item 95 for the plumbing work involved in raising the toilet; 20. extra paint needed for internal works as the old cans ran out ($200.00): the builder does not say how much paint was left on site and why it would have been sufficient for the range of painting tasks carried out by Touchwood.

[229]

The correspondence between the parties

On 17 March 2019 at 10.15pm, the owner sent an email to the builder and Mr Wilkinson, which was copied to her solicitor Hannah Shephard (Ms Shephard), with the subject "Toilet dual flush plate" as follows: "I was advised by the site foreman on Thursday 14 March 2019 that the specified Vola ASS mechanical dual actuator plate in brushed stainless steel could not be installed. Upon investigation it is apparent that you did not provide the minimum built in depth of 35mm as required to fit the Vola flush plate. This is extremely disappointing: • The bathroom fittings were specified by AKO are were already part of the contract. • All the tap ware in the bathroom is Vola, and an alternative brand will not match • The Vola flush plate is extremely thin, nothing in the market is as thin. Please supply Geberit Sigma 70 Dual Flush Button 80mm Brushed stainless steel (Product code 1811559)."
On 25 March 2019 at 2.15pm, the builder sent an email to the owner, which was copied to Mr Wilkinson and Ms Shephard, with the subject "Toilet dual flush plate" relevantly as follows: "We have installed the Gerberit concealed cisterns as per there specifications. As you can see below from Morris's email (Metro Pipes Plumbing) it can only be set in one way there is no adjustment with these units. Gerberit also recommend installing Gerberit Flush buttons as these are fully compatible with the Gerberit brand of products and not as you suggested below (highlighted in red). We have used wall tiles as per specification document by AKD July 2016 as all this information was supplied by AKD and during the construction process we have attempt to consult with AKD who on all accession declined to assist as they said it was not part of their brief. On the documentation package specifications it also clearly states that Client is to ensure/confirm fixtures & fittings requested are compatible with layout & configuration required prior to ordering. Greg has also spoken and meet your supplier Dominic from Sydney Taps who confirmed the concealed cisterns are in fact set correctly and that he will exchange your Vola flush buttons for Gerberit Flush 560 buttons and reimburse you the cost difference. …"
On 25 March 2019 at 9.27pm, the owner sent an email to the builder and Mr Wilkinson, which was copied to Ms Shephard, with the subject "Toilet dual flush plate" as follows: " … Firstly, I confirm that the Gerberit concealed cistern has been installed correctly and the wall tiles used were supplied by me in accordance with the AKD specification. The only reason the Vola flush plate does not fit is because you did not install the specified 13mm Aquachek wall lining and instead installed 6mm Villaboard. This did not provide the requisite wall thickness to be able to install the Vola flush plate. …

[239]

The applicable legal principles

In Toplace Pty Ltd v Rashidianfar [2021] NSWCATAP 235 (Toplace) at [32], [36], [38], [45] and [46] the Appeal Panel made the following observations about a claim for loss of rent by way of damages for delay: "[32] In Leeda Projects v Zeng (2020) 61 VR 384; [2020] VSCA 192 Kaye JA at [12] set out the following in relation to contractual damages (citations omitted): The fundamental principles, for the determination of damages for breach of contract, are well established. Essentially, damages are awarded in order to compensate the injured party for the loss and damage arising from the breach of contract. Thus, damages consist of the sum of money which will put the injured party in the same position as if the breach of contract had not occurred. In order to determine the appropriate measure of damages in a particular case, it is necessary first to identify the kind of loss for which the injured party claims compensation. The loss, which is compensable in an action for breach of contract, is that which may fairly and reasonably be considered as arising naturally, that is, according to the usual course of things, from the breach of contract itself, or such as may be reasonably supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. … [36] In his decision, as noted above, the Member referred to Hadley v Baxendale and framed the question that he had to answer as being whether the loss of rent was in the reasonable contemplation of the parties at the time they made the contract. We agree that this was a correct characterisation of the issue as it could not be said that loss of rent arises naturally from the breach. .. [38] Hadley v Baxendale requires an assessment of what could be reasonably supposed to have been in the contemplation of both parties, at the time they made the contract, as the probable result of the breach of it. We agree with Toplace that the relevant time for assessment of what was in the parties contemplation is the time at which the contract was entered into. … [45] The cases that have dealt with whether the loss of the kind claimed may be reasonably supposed to have been in the contemplation of the party against whom the claim is made indicate that some knowledge of the relevant circumstances and an undertaking of the risk, whether that be express or implied, are required (see Victoria Laundry (Windsor) Ltd v Newman Industries Ltd [1949] 2 KB 528; Diamond v Campbell-Jones [1961] Ch 22). Bergin J in Sumy Pty Ltd v Southcorp Wines Pty Ltd [2004] NSWSC 1000 at [77], after reviewing cases in the area, albeit in relation to a contract for the sale of land, noted that there must be some specific knowledge at the time of entering the contract. The person claiming damages must be able to show that, in this case, loss of rent, was more than merely one of a range of foreseeable outcomes (Castle Constructions Pty Ltd v Fekala Pty Ltd (2006) 65 NSWLR 648 at [52]). [46] The following cases illustrate that there be must be some knowledge on the part of the builder at the time the contract is entered into. In Bui v DB Homes Australia Pty Ltd [2017] NSWCATAP 218 in hearing an appeal from homeowners in relation to claimed loss of rental income as a result of delay by the builder in completing the construction of a granny flat, the Appeal Panel noted at [28] that it cannot be assumed that the mere fact that someone is building a granny flat is for the purposes of rental. Similarly, in Ippolito v Cesco [2020] NSWSC 561 Ball J did not allow a claim for lost rent in circumstances where at the time the building contract was entered into it was not anticipated that the premises would be rented out."

[241]

The submissions of the owner

In the owner's 21 May 2021 submissions, the owner's 19 July 2021 submissions and her oral submissions the owner made the following submissions: 1. the builder ought to have known that she would derive income from the property or, alternatively, would be required to expend money on alternative accommodation and accordingly delay would cause the owner to suffer loss; 2. she relied on the following passage in McGregor on Damages (21st edition, 2020, Thomson Reuters) (McGregor) at [31-009]: "If the builder fails to complete the building by the time required 01 the contract the normal measure of damages should be the value of the use of the building during the period of delay, the value general/y being taken as the rental value." 1. she relied on Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384; [2020] VSCA 192 (Leeda Projects) at [57] per Kaye JA (Tate JA at [1] agreeing) and at [189] per McLeish JA (Tate JA at [1] agreeing): "[57] In the present case, based on the findings of the VCAT Member, the respondent acquired the Eureka apartment for the purpose of her intended use and enjoyment of it as a private art gallery and occasional residence. The building contract described the contract works as 'Fit-out of Private Art Gallery'. The costs of ownership of the apartment - the rates, service charges and the like - were incurred to enable the respondent to have and use the Eureka apartment for that specific purpose. Thus, the proportion of those costs, that the respondent incurred during the delay period, are an appropriate measure of the loss and damage occasioned to her by reason of her inability to use the apartment for its intended purpose during the 130 week delay period, which was caused by the breach of the contract by the applicant. In view of the specific purpose of the building contract, that loss and damage was a reasonably foreseeable consequence of the breach of contract by the applicant." "[189] ... Applying those principles, in my opinion, it must have been within the reasonable contemplation of the parties that, if there was a delay on the part of Leeda in completing the works within a reasonable time, Mrs Zeng would be required to make payments in respect of a property which she could not use, being payments from which she acquired no benefit. The fact that the payments would have been made in any event does not mean that they are not recoverable. …" 1. she relied on the decision in ACN 057 690 034 Pty Ltd v Mick Wykrota [2019] NSWSC 197 (Wykrota) where Emmett AJA in undefended proceedings allowed a claim for loss of opportunity to rent premises in circumstances where there was no evidence that there was in fact a tenant, or there were tenants, who would have been able to take tenancies of the relevant parts of the premises for the period in question; 2. she relied on the following passage in the decision of the Western Australian Building Disputes Tribunal in Kitto v TGSBC Pty Ltd [2004] WABDT 28 (Kitto): "The contract deals at some length with time for performance so that the date for commencement and completion of the Works were of obvious importance. It is difficult to imagine any circumstance in which the completion date of a building contract would not be of significance. When the construction is for commercial or investment purposes delay has obvious financial consequences. Where a residential dwelling has been constructed, as here, the intended purpose is either to enable the owner to reside in the property or to take steps to realise the benefit of the investment either by letting or resale. In either case there are usually cost consequences in the form of rental incurred to live elsewhere or holding costs." 1. had claimed $151,500.00 for 100 weeks of loss of use of the premises. She pressed a claim for $39,000.00, being the equivalent of 6 months loss of rent. By any measure, it is a modest amount for the loss of use of the residential premises for the period since the works were due to be completed, and for the future period in which rectification works will need to be carried out.

[246]

Quantum meruit

In Vasco Investments Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 (Vasco) at [339]-[342], [344]-[347] Vickery J set out following principles which apply to an action in quantum meruit, as derived from Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221; [1987] HCA 5, Brenner v First Artist Management Pty Ltd [1993] 2 VR 221, Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27 and the cases cited therein: "[339] The law may impose an obligation to make restitution on a quantum meruit basis, under what I will call the first class of case, where the plaintiff proves: a. Actual or constructive acceptance of the benefit of the provider's goods or services by the recipient; b. The recipient of the goods or services should have realised that the provider expected to be paid; and c. It would be unjust for the recipient to take the benefit of the goods or services provided without paying a reasonable sum for them. [340] A second class of case falling under the umbrella of a claim in quantum meruit is the long established and well-recognised category of cases constituted by claims for work and labour done or money paid at the request of another. [341] In both classes of case, the law imposes an obligation independent of contract to pay a fair and reasonable sum for the goods or services, founded on the principles of restitution for unjust enrichment. [342] A third class of case giving rise to a claim described as quantum meruit is where goods or services are provided under an existing and enforceable contract which contains an express or implied term to pay a fair and reasonable sum for them, but such sum is not quantified. The action is directed to determining the fair and reasonable sum payable. … [344] Under the first (and indeed the second) class of case, there is no requirement that a 'benefit' for the purpose of this rule of restitution in a claim for payment for services must be an economic benefit. Nor is there a requirement that the provider of the services show that any benefit has arisen as a direct consequence of a particular service rendered. In a claim based on restitution for the benefit of services provided, the question of whether the services constitute a benefit must be considered from the perspective of the recipient, and it is the services themselves which fall to be considered, not the end product of those services. [345] The cause of action seeking relief in quantum meruit in the first class of case (cf. the second class of case) does not call for specific proof of the making of an express or implied request by the recipient of the goods or services. Rather, the making of a request, which is a common factual component in these cases, may provide evidence of a benefit conferred on a recipient. It may also provide evidence of the acceptance of the services that were requested. Further, work done in conformity with a request will in most cases sufficiently satisfy the requirement, stemming from principals of unjust enrichment, that a recipient should not unjustly benefit from the services provided without paying reasonable compensation for them. [346] The provider of the services in the first class of case must prove that the services were not provided as a gift, or on the basis that payment should not be made unless a pre-condition has been met and that condition remains unfulfilled. [347] The court is not concerned with the actual state of mind of the parties when considering whether payment ought to have been contemplated in the first class of case. The appropriate enquiry is whether the recipient of the services, as a reasonable person, should have realised that a person in the position of the provider of the services would expect to be paid for them. Where the services are provided pursuant to a request made in a normal commercial relationship with a person whose business it is to provide those services for reward, this requirement will usually be satisfied. [348] The circumstances which may satisfy the element of injustice sufficient to impose an obligation under the first class of case to make fair and just restitution will vary from case to case. In Angelopoulos v Sabatino (1995) 65 SASR 1 at 12-13, Doyle CJ noted nine factors which were held in that case to give the acceptance of the relevant services the necessary character to support the claim. But these are by no means definitive or exhaustive. Some elements or variants thereof may appear in some cases which justify relief, others may not."
In Angelopoulos v Sabatino (1995) 65 SASR 1 (Angelopoulos), which involved the plaintiffs as prospective lessees of a hotel providing plant and equipment and installing it in hotel premises with knowledge and approval of Ditara Pty Ltd, the owner of the hotel, at 12-13, Doyle CJ noted nine factors which were held to give the acceptance of the relevant services the necessary character to support the claim: "First, the plaintiffs did not intend to provide their services gratuitously. They expected a return, if only in the form of more favourable terms of lease. Secondly, the plaintiffs did not provide their services and supply the plant and equipment entirely at their own initiative. They acted not only with the knowledge of Ditara, through its agents, but with the approval of Ditara. In my opinion there was more than passive acquiescence. It is not necessary for me to find that there was a request that the services be performed and the plant and equipment supplied, but were it necessary to do so I would be prepared to conclude that there was an implied request. Thirdly, the plaintiffs did not provide their services on the basis that there would be no payment unless a certain event came to pass. By proceeding as they did the plaintiffs incurred the risk that if a lease did not eventuate they would not be remunerated. But this was not a situation in which it was a common understanding that there would be no remuneration in the event of there being no lease. It was not a situation in which common business practice indicates the parties did intend or should as reasonable persons have realised that remuneration was conditional upon the grant of a lease. Fourthly, this was not a case in which the services were provided on a basis from which the plaintiffs chose to depart. It is not necessary to decide whether the failure to agree upon a lease was attributable to unreasonable conduct on the part of either party. It suffices to say that on the findings of his Honour the plaintiffs did not unilaterally or unreasonably terminate negotiations. Fifthly, the defendant Ditara benefited from what the plaintiffs did. Ditara either incurred less expense than it otherwise would have incurred in restoring the premises or alternatively had premises better fitted for letting out. Sixthly, that benefit was conferred at the expense of the plaintiffs. Seventh, Ditara by its agents approved of or agreed to the plaintiffs carrying out the work which they did. In addition, Ditara by its later sale of plant and equipment, including the plant and equipment installed by the plaintiffs (it being the case that some, at least, of that plant and equipment was readily removable), accepted the benefit of that part of the plaintiffs' work. Eighth, in my opinion the circumstances were such that Ditara by its agents must have known as a reasonable person that the plaintiffs expected to be remunerated for their services. Ninth, there is no argument advanced identifying any particular circumstance by virtue of which it is unjust to require Ditara to remunerate the plaintiffs. By this I mean that no matter such as change of position was advanced, nor, subject to the counterclaim, was it suggested that the work carried out was work which Ditara did not want done or which was of no use to Ditara."
In Roude v Helwani [2020] NSWCA 310 (Roude) White JA at [28]-[52] (Brereton JA at [56] and McCallum JA at [57] agreeing) held that the onus was on the builder to establish the reasonableness of his charges in a quantum meruit claim. The determination of the quantum meruit claim did not require the builder to establish the "market rate" for the work performed or to provide an "objective standard" on which his charges could be judged. Although a quantum meruit claim may be proved by such evidence, a judge is not precluded in its absence of same, in the particular circumstances of each case, from making an assessment as to whether the evidence adduced established the reasonableness of the charges. A builder may give evidence of the reasonableness of his charges. White JA at [33] (Brereton JA at [56] and McCallum JA at [57] agreeing) held that a failure to respond to a demand for payment may amount to an admission if there are circumstances which render it more reasonably probable that the owner who denied liability for the claim would answer the claim than that he would not.

Legislation Cited (4)

Civil and Administrative Tribunal Act 2013(NSW)

Home Building Act 1989(NSW)

Home Building Regulation 2014(NSW)

Work Health and Safety Act 2011(NSW)

Cases Cited (32)

Kitto v TGSBC Pty Ltd [2004] WABDT 28 Koompahtoo Local Aboriginal Land Council v Sanpine Pty Ltd (2007) 233 CLR 115; [2007] HCA 61 Lawrence v Ciantar; Ciantar v Lawrence [2019] NSWSC 464 Leeda Projects Pty Ltd v Zeng (2020) 61 VR 384; [2020] VSCA 192 Lumbers v W Cook Builders Pty Ltd (in liq) (2008) 232 CLR 635; [2008] HCA 27 Pavey & Matthews Pty Ltd v Paul (1987) 162 CLR 221; [1987] HCA 5 Toplace Pty Ltd v Rashidianfar [2021] NSWCATAP 235 Roude v Helwani [2020] NSWCA 310 Vasco Investments Ltd v Morgan Stanley Australia Ltd [2014] VSC 455 Woodward v D J & T L Mellross Pty Ltd [2018] NSWCATAP 179 Xtraordinary Constructions Pty Ltd v Luppino [2021] SASC 132 Texts Cited: J Edelman, McGregor on Damages (21st edition, 2020, Thomson Reuters) New South Wales Legislative Assembly, Parliamentary Debates (Hansard), 6 May 2014 Rawlinsons Australian Construction Handbook (38th edition, 2020, Rawlinsons Publishing) Category: Principal judgment Parties: HB 19/48969: Anthony Allan Lucien (Applicant) Nerida Mullally (Respondent)

The relevant legal principles

In Health Care Complaints Commission v Ng [2015] NSWCATOD 85 (Ng) at [128]-[130] the Tribunal set out the following observations on assessing the credit of a witness: "[128] We found the recent discussion by Sackar J in Campbell v Campbell [2015] NSWSC 784 at [73] to [79] to be of considerable assistance. To paraphrase his Honour: (1) Where a trial judge is faced with a stark choice between irreconcilable accounts, the credibility of the parties' testimony, the trial judge's assessment of the character of witnesses and the manner in which the witnesses give evidence is of primary importance: McGraddie v McGraddie [2013] UKSC 58; [2013] 1 WLR 2477. (2) The rational resolution of an issue involving the credibility of witnesses will require reference to, and analysis of, any evidence independent of the parties which is apt to cast light on the probabilities of the situation: Camden v McKenzie [2007] QCA 136; [2008] 1 Qd R 39 at [34] Keane JA; referred to with approval by Leeming JA in New South Wales v Hunt [2014] NSWCA 47 at [56]. (3) A court, in cases involving events which occurred long before the litigation, usually prefers to rely upon contemporaneous, or near contemporaneous, documents, which will often provide valuable and, usually, more revealing, information than what may be flawed attempts at recollection of those facts by persons with an interest in the outcome of the litigation: Bathurst Regional Council v Local Government Financial Services Pty Ltd (No 5) [2012] FCA 1200 at [1247]. Greater weight is usually accorded to such documents, as often they provide a safer repository of reliable fact, particularly when it is clear that they have been prepared by a person with no reason to misstate those facts in the documents and where there is no suggestion that the documents are other than genuine: Hughes v St Barbara Mines Ltd [No 4] [2010] WASC 160, per Kenneth Martin J, at [157]. [129] His Honour also referred at [75] to the dissenting speech of Lord Pearce in Onassis v Vergottis [1968] 2 Lloyd's Rep 403, who stated at 431: a witness, however honest, rarely persuades a Judge that his present recollection is preferable to that which was taken down in writing immediately after the accident occurred. Therefore, contemporary documents are always of the utmost importance. And lastly, although the honest witness believes he heard or saw this or that, is it so improbable that it is on balance more likely that he was mistaken? On this point it is essential that the balance of probability is put correctly into the scales in weighing the credibility of a witness, and motive is one aspect of probability. All these problems compendiously are entailed when a Judge assesses the credibility of a witness; they are all part of one judicial process and in the process contemporary documents and admitted or incontrovertible facts and probabilities must play their proper part." [130] The credibility of a witness and his, or her, veracity may also be tested by reference to the objective facts proved independently of the evidence given, in particular by reference to the documents in the case, by paying particular regard to his, or her, motives, and to the overall probabilities: Armagas Ltd v Mundogas S.A. (The "Ocean Frost") [1985] 1 Lloyd's Rep 1 at [57]; In the matter of Kit Digital Australia Pty Ltd (in liq) [2014] NSWSC 1547 at [7]."

[2020] VSCA 192

[2014] VSC 455

[2021] SASC 132

[2007] QCA 136

[2010] WASC 160

(1995) 65 SASR 1

(2007) 233 CLR 115

(2020) 61 VR 384

(2008) 232 CLR 635

(1987) 162 CLR 221

(2006) 65 NSWLR 648

[2019] NSWSC 197