DATE OF RECEIPT OF RESPONDENT FINAL SUBMISSIONS

DATE OF RECEIPT OF APPLICANT'S REPLY SUBMISSIONS

Nerwa Constructions Pty Ltd v Koka (Building and Property) [2025] VCAT 79

1. The respondent must pay to the applicant the sum of $86,249.
2. The applicant may within 30 days make an application for interest.
3. There is leave for both parties to make an application for costs or reimbursement of fees within 30 days.
4. The principal registrar is directed to refer any application for interest, costs or reimbursement of fees to Senior Member Edquist who will make further orders for their disposition.

1. In this proceeding Nerwa Constructions Pty Ltd (ACN: 146 593 222) ('the builder') seeks damages for breach of a major domestic building contract ('the contract') it entered into on 27 September 2018 with Mr Ayad Koka for the construction of a home at Mr Koka's property in Craigieburn. Mr Koka defends the claim and has made a counterclaim.
2. The builder is a company operated by Mr Nisho Kasho, a registered building practitioner (domestic builder unlimited). Mr Kasho is a director of the builder and may be regarded as its 'moving mind' or controller.
3. The builder initiated this proceeding in 2019 to recover damages for breach of the contract. One of the claims initially made by the builder was that Mr Koka had not paid the fixing stage claim of $90,750, which was invoiced on 8 April 2019. As the proceeding progressed, it became clear that the builder was also seeking payment for a large number of variations. In final submissions filed on 1 February 2024, the builder contended that the original contract price of $353,000 was to be adjusted by a figure of $64,721.25 for variations it had performed, yielding an adjusted contract sum of $427,721.25.

1. The final hearing began before me on 14 August 2023, and continued on 15, 16, 17, 18 and 28 August 2023. The builder was represented by Mr Richard Fink of Counsel. Mr Kasho gave evidence, and the builder called Mr Stephen Kosa, an architect, as an expert witness. He also called Mr Ivan Dawood.
2. Mr Koka was represented by Ms Gisela Nip of Counsel. Mr Koka gave evidence, and called building experts Patrick Kerr, author of the first Darbecca report, Mr Hayden Sherwood, the author of the last three Darbecca reports, Mr Raja Chidhambaram of BEZT Building and Pest Inspections Victoria and Mr Les Camilleri of Master Property Inspections ('MPI'). He also called a quantity surveyor, Mr Douglas Buchanan. The final hearing was not concluded on 28 August 2023, as the parties at that point had not presented expert evidence concerning the cost of rectifying defects and completing the works. However, following the first phase of the hearing, it was clear that the question of which party had breached the contract was going to be critical for the assessment of damages.
3. I pointed out to the parties that the damages to which the owner, Mr Koka, would be entitled to in respect of defects and incomplete works at common law would be affected by the answer to the question of whether he had wrongfully terminated the contract. If Mr Koka had acted properly in bringing the contract to an end, then under the usual rule for the recovery of damages for breach of contract, Mr Koka would be entitled to recover the cost of having the works rectified or completed by another contractor, although he would have to allow to the builder a credit in respect of the unpaid balance of the contract sum. On the other hand, if Mr Koka had acted wrongfully in terminating the contract, he would be liable to the builder for damages. The builder would be entitled be put in the same position as it would have been had the contract been performed. Accordingly, provided the builder could demonstrate that it would have been ready and willing to return to the site, the builder would be able to recover the profit it would have made in respect of the unperformed portion of the contract had the contract been performed. The profit could be determined by identifying the unpaid balance of the adjusted contract sum, and then subtracting the notional cost to the builder of returning to the site to rectify defects and to complete the works, assessed as at the time of termination.

1. Because of the criticality of determining whether the contract had been lawfully terminated by Mr Koka, I suggested to the parties, and ultimately directed, that the issue be determined as a preliminary question. As the evidence on the issue had closed, I considered the matter and published my determination with reasons on 6 October 2023. The orders and reasons ('Reasons') were published with the citation Nerwa Constructions Pty Ltd v Koka (Building and Property) [2023] VCAT 1137. I ordered:
   1. Under s 124 of the Victorian Civil and Administrative Tribunal Act 1998 (Vic), the Tribunal declares that the respondent wrongfully terminated the contract he made with the applicant on or about 27 September 2018 ('the contract').
   2. In assessing the cost of rectifying defects in the work performed by the applicant under the contract or in completing the works under the contract, the costs are to be assessed on the basis of what the rectification work or the completion work (as the case requires) would have been to the applicant at the time of termination of the contract in June 2019.
2. As it has been determined that it was Mr Koka who wrongfully terminated the contract, there is scope for the operation of clause 19.4 of the contract. This provides:

If the Owner without reasonable cause does not allow the Builder the opportunity to return to the Land to make good and rectify any defects or does not provide reasonable access to the Builder to allow the Builder to do so the Builder will only be liable to the Owner for the cost which the Builder would have incurred had the Builder been permitted to rectify the defect.

Clearly, this clause echoes the common law position.

1. Once the preliminary question had been resolved, it was appropriate to conduct a further hearing at which the parties could be heard concerning the assessment of damages. This was conducted on 30 October 2023. Again, Mr Fink appeared on behalf of the builder and Ms Nip appeared on behalf of Mr Koka. Mr Kosa was called by the builder to give evidence as to quantum, and Mr Koka called Mr Buchanan on the issue.
2. Following the final hearing on damages, the parties were given an opportunity to file and serve final submissions. In its final submissions dated 1 February 2024, the builder asserted that Mr Koka's counterclaim for incomplete work should be valued at $12,570.10, and that the counterclaim, in so far as it related to defects, should be limited to $4,242.70. On the basis that the builder contends that the adjusted contract sum is $427,721.25, the builder submits that, allowing for payments made by Mr Koka of $235,950, it is entitled to a balance of $174,954.45. The builder also seeks interest and costs.
3. Mr Koka's view of his entitlements is radically different. In his final submissions dated 12 March 2024, he contends that the builder has no entitlement to variations as they were not asked for. He says that there were 75 defects, and in respect of most of them, he relies in part on an assessment of the cost to rectify of $308,100 established by Mr Buchanan in his report dated July 2021[1]. In relation to certain defects, he does not rely on Mr Buchanan alone but relies on invoices which he deposes came from individual tradesmen who performed rectification work for him after the builder had been terminated so that he could move his family into the house. The value of these invoices he puts at $57,885.36. Mr Koka asserts that he is entitled to be paid a total of $282,944.86 in respect of defects and incomplete work, and he claims this sum plus interest.
4. The builder does not dispute that Mr Koka carried out some work after the contract was terminated on 21 June 2019. The occupancy permit was not issued until 17 September 2019, almost 3 months later. What the builder does question is whether the work performed by or on behalf of Mr Koka fell within the scope of works under the contract or whether it was carried out at all. It is possible that some of the works performed after June 2019 fell outside the scope of the contract, or constituted betterment works. It was also suggested that tradespeople engaged by Mr Koka after the builder had left the site may have damaged the roof which had been constructed by the builder, and in that way necessitated rectification works for which the builder was not responsible.
5. It was recognised by the builder that where there was a breach of a building contract the High Court decision in Bellgrove v Eldridge[2] ('Bellgrove') confirmed that the owner was entitled to an award of damages which would enable the owner to rectify any defects in the work so that the owner got a house on his land constructed in accordance with the contractual plans and specifications. However, the builder submitted that many of the defects identified by Mr Koka's experts were technical in nature, and did not warrant an award of damages because they fell within the exception to the general rule for the recovery of damages for breach of a building contract established by Bellgrove to the effect that the rectification works had to be both necessary (to bring about conformity to the contract) and a reasonable course to adopt.
6. It follows from the summary of the case above that I must determine the following issues:

(a) Against the original contract sum, how much has been paid by Mr Koka?

(b) Was the builder entitled to be paid the fixing stage invoice?

(c) Was the contract sum to be adjusted, taking into account the builder's claims for variations?

(d) What defects existed at the time the contract was terminated?

(e) In respect to what defects is Mr Koka entitled to recover damages ('the compensable defects')?

(f) What would it have cost the builder to rectify the compensable defects?

(g) What would it have cost the builder to complete the works?

(h) What sum is the builder entitled to be paid, having regard to the adjusted contract sum, the amount already paid by Mr Koka, Mr Koka's entitlement to damages in respect of defects, and the cost to the builder of completing the contract works as at the time the contract was terminated?

1. I will turn to these issues in turn shortly. Before I do so, I was to underline that this is a case where neither party paid strict adherence to the terms of the contract. It was suggested by Mr Fink, when he opened for the builder, that for cultural reasons, the terms of the contract were not applied strictly. The context was that Mr Kasho and Mr Koka were from the same Syrian Iraqi community.
2. I think there is much in Mr Fink's observation. For instance, Mr Koka took the liberty of upgrading certain items allowed for in the contract. This gave rise to claims for variations on the part of the builder. In the Reasons, at [65] I observe that Mr Koka consistently demonstrated that he did not understand the contract he had entered into. Specifically, I said, (with citations deleted):

Mr Koka consistently demonstrated that he did not understand the nature of the contract he had entered into. For instance, Mr Koka was so keen to get on with the works that soon after the building permit was issued on 15 October 2018 Mr Koka directed Kings Excavation to undertake the site cut. (This is not disputed: Mr Koka's in his witness statement agreed that he had paid $7,000 in cash directly to the earthworks contractor). Mr Koka often went to the site and complained about things not being finished. Mr Koka confirms that he "kept identifying defects in the construction process..." Mr Koka made numerous changes to the contract, including ordering a fireplace when there was no fireplace in the contract specifications, changing the bath in the master bedroom ensuite, changing the air. Recycling area in the hallway, changing the kitchen pantry and adding additional bulkheads above the kitchen area, changing the painting specification, changing the kitchen cabinetry, ordering waterfall stone for the kitchen bench, and changing the tiling specification.

1. To this list it is appropriate to add the windows. They were stipulated in the plans as awning windows. However, Mr Koka decided he wanted sliding windows, which were included in the finally agreed Lists of Inclusion or specification. In the event, the builder installed awning windows as initially specified. Mr Koka contended in his final submissions, from [54], that where the builder had installed awning windows rather than sliding windows, the windows were defective.
2. For his part, Mr Kasho paid no attention to the requirements of the contract for the documentation of variations. The relevance of this is discussed below, from [22].
3. A further preliminary point is that Mr Koka made an attack on Mr Kasho's ethics as a builder in his witness statement and attacked him personally in his oral evidence. It is not necessary to go into these attacks in detail as they do not provide the basis for any claim being made by Mr Koka outside the terms of the contract. It is to be firmly borne in mind that it is the contract that established the relationship between the parties and is the basis of the respective claims. This remains the case.

1. In his witness statement[3] Mr Koka asserts, at [8]:

Mr Kasho had offered that I organise and do my own home construction if I wanted and that he would "sign off" for $20,000. I told him this didn't suit me as I did not have experience or know the relevant trades people and that if I was already paying $20,000 I would rather pay extra and have it built for me instead.

1. Mr Kasho meets these allegations head-on, as he deposes in his witness statement[4] that he has been a registered builder with the Victorian Building Authority since 2011 and that his registration number is DB-U 37800. He holds a number of building related diplomas and certificates, including a Certificate IV in Building & Construction from the Master Builder's Association of Victoria. He studied civil and mechanical engineering for two years at the Manukau Institute of Technology in Auckland, New Zealand, and civil engineering at the University of Mosul in Iraq. He has been practising as a building practitioner for almost twenty years, first in New Zealand and then Australia. He estimated he had built over 100 houses. He expressly stated, at [4] of his witness statement "I do not perform (and never have performed) 'sign-offs' for other people. Rather, I perform domestic building works for, and as part of, my own company."

1. The contract was in the form of a Master Builders Victoria standard form HC-7 (2018).[5] It was not suggested by Mr Koka that the contract did not comply with the extensive requirements contained in s 31(1) of the Domestic Building Contracts Act 1995 (Vic) (the 'DBC Act'). The contract contained an agreed specification and referred to drawings that Mr Koka had commissioned from an engineering firm, Windrock Group ('Windrock'). Having reviewed the contract, I am satisfied that it met the requirements of s 31(1).
2. The contract was signed by Mr Kasho on behalf the builder and by Mr Koka personally on 27 September 2018. Accordingly, the contract is not unenforceable by reason of s 31(2) of the DBC Act. A building permit was issued by the City of Hume on the application of Mr Koka on 15 October 2018 naming the Mr Kasho's company as the builder and identifying the relevant domestic building works insurer and the insurance policy.[6] At this point it became a legally enforceable. Once a building permit had been issued under s 16 of the Building Act 1993 (Vic), it was lawful for the builder to carry out the work covered by the building permit.

How much has been paid by Mr Koka against the original contract sum?

1. The contract price was $363,000, payable in accordance with the following schedule progress claims.
   • Deposit (5%) $18,150.
   • Base stage (10%) $36,300
   • Frame stage (15%) $54,450
   • Lock-up stage (35%) $127,050
   • Fixing stage (25%) $90,750
2. Although the contract was executed on 27 September 2018, building work could not begin straight away because the building permit was not issued until 15 October 2018.[7] Mr Koka paid the builder the deposit in October 2018.[8] A progress claim in relation to the base stage was issued on or about 9 November 2018 and was paid within about 10 days. The frame stage invoice was issued on or about 4 December 2018 and this was paid within about a week. Or about 15 January 2019, the builder issued an invoice in relation to the lock-up stage. This was paid within nine days.[9] This brought the total amount paid by Mr Koka to $235,950.
3. Or about 8 April 2019, the builder rendered an invoice in relation to the fixing stage in the sum of $90,750. Mr Koka failed to make payment of this progress claim before he unlawfully terminated the contract on 21 June 2019.[10]
4. It follows that prior to the termination of the contract Mr Koka had paid a total of only $235,950. The fixing stage invoice for $90,750 remained unpaid.
5. At the date of termination a number of variations had been claimed by the builder which were disputed by Mr Koka and they also remained unpaid.

Was the builder entitled to be paid the fixing stage invoice?

1. The issue of whether the builder was entitled to be paid the fixing stage invoice was discussed and length in the Reasons issued with the orders made on 6 October 2023, at [18]-[36]. It was necessary to discuss the issue because one of the bases that Mr Koka relied on as justifying his termination of the contract was that the builder had not been entitled to issue the fixing stage invoice because the works were incomplete or defective.
2. On behalf of the builder, Mr Kasho deposed that by 7 April 2019 everything for the fixing stage was finished except the toilets and some basins. On 8 April 2019, the builder submitted a claim for the fixing stage of the works, as the fixing stage was effectively complete, save for items Mr Koka had prevented the builder from installing.[11]
3. The issues with the toilet were discussed in detail, and at [27] of the Reasons I found that:

in so far as the toilet in the master bedroom ensuite was concerned, the works had been carried out and completed in accordance with the plans and specifications. The fact that Mr Koka later changed the specification for the toilet was not a matter that disentitled the builder from claiming the fixing stage payment, if the fixing stage works had otherwise been completed.

1. The issues with the basins were also canvassed, and at [30] of the Reasons, I held:

once the basins had been properly fixed on the first occasion, they ceased to be an impediment to the issuing of the fixing stage progress claim. The fact that the owner changed the bath and that this necessitated the movement of one basin does not alter the position. I find against Mr Koka in respect of this issue also.

1. The second limb to Mr Koka's argument that the fixing stage invoice should not have been submitted was that the works were defective. Mr Koka relied on the alleged existence of 42 defects identified by the building consultant from Darbecca in what was referred to as the First Darbecca Report. Mr Kasho submitted that it was not apparent that any of these defects related to the fixing stage. I accepted this submission.[12] Moreover, I held, at [36] of the Reasons:

The unpaid progress claim related to the fixing stage, not completion. The builder was not representing that the works were complete. To paraphrase the test articulated in Cardona[13], the builder had until handover to complete the works and rectify any defects which were not merely trivial or caused by some impracticality, Accordingly, I find that the existence of defects or incomplete works at the time that the fixing stage invoice was issued does not of itself mean that the fixing stage invoice was invalid.

1. As Mr Koka's two arguments as to why the fixing stage payment was not due have been disposed of, I formally find that the fixing stage payment was due. The builder is entitled to payment of $90,750. Interest will also be payable on this amount. The claim for interest will be dealt with separately.

Was the contract sum to be adjusted, taking into account the builder's claims for variations?

1. On 6 May 2019 Mr Kasho sent Mr Koka an email claiming 16 variations. The timing is significant. The fixing stage progress claim had been issued on 8 April 2019 and had not been paid. On the morning of 6 May 2019 Mr Koka had sent an email to Mr Kasho acknowledging receipt of the progress claim and advising that he was more than happy to pay once the stage was properly completed in accordance with the Darbecca report.
2. About three hours later Mr Kasho sent the list of variations he was claiming. He indicated that builder's margin 25% would be added to the total cost of the variations. The list reads as follows:

1- Extra Cost for removing stone for underground drainage $1,980.

3- Installing tap mixers inside the walls with your responsibility for the distance $750.

5- Remove the walls and sliding doors at bathroom and pantry $2,000.

8- Changing tile laying from 600 to 1200 length and extra tiles on toilets and laundry $6,000.

1. Mr Kasho acknowledges that he did not deal with the variations formally. In his witness statement, at [39] he states:

I tried to accommodate Ayad's numerous requests. I did not issue formal variation requests for these works, as I trusted Ayad to pay them. The continual changing of my scope of works and the directions to my subcontractors, however, was a constant source of disruption and change to the builder.

1. Mr Koka in his witness statement, at [72], dismisses the claim for defects globally. He says that after he said that the better report to Mr Kasho on 6 May 2019, he received an email "claiming over $50,000 for extras." Mr Koka deposes:

I had never requested these extras and this was all made up. I replied to him via email that these extras were not legitimate and were never requested and for him to simply finish the house as per the contract and as per the plan.

1. Mr Koka confirmed his position in an email to Mr Kasho dated 15 May 2019, stating emphatically "I DON'T WANT ANY EXTRAS. Please feel free to remove '2Xtras from the property as I do not want them and never asked for them."
2. I highlight the language employed by Mr Koka in this email. He does not dispute that variations have been performed. On the contrary, he acknowledges that some variations have been performed. His point is that he does not want them and he is happy for them to be removed.
3. In the light of Mr Koka's blanket denial of liability for the variations, it will be necessary to examine the evidence relating to each of them. However, one global observation can be made. Each of the alleged variations arose as a result of a direction being given by Mr Koka either to Mr Kasho directly or to the relevant tradesperson. Accordingly, there is an impediment to the builder recovering payment in respect of the variations by reason of s 38 of the DBC Act, which governs variations to the plans or specifications by a building owner. Section 38 provides:

(1) A building owner who wishes to vary the plans or specifications set out in a major domestic building contract must give the builder a notice outlining the variation the building owner wishes to make.

(2) If the builder reasonably believes the variation will not require a variation to any permit and will not cause any delay and will not add more than 2% to the original contract price stated in the contract, the builder may carry out the variation.

(3) In any other case, the builder must give the building owner either -

(a) a notice that -

(i) states what effect the variation will have on the work as a whole being carried out under the contract and whether a variation to any permit will be required; and

(ii) if the variation will result in any delays, states the builder's reasonable estimate as to how long those delays will be; and

(iii) states the cost of the variation and the effect it will have on the contract price; or

(b) a notice that states that the builder refuses, or is unable, to carry out the variation and that states the reason for the refusal or inability.

(4) The builder must comply with subsection (3) within a reasonable time of receiving a notice under subsection (1).

(5) A builder must not give effect to any variation asked for by a building owner unless -

(a) the building owner gives the builder a signed request for the variation attached to a copy of the notice required by subsection (3)(a); or

(b) subsection (2) applies.

(6) A builder is not entitled to recover any money in respect of a variation asked for by a building owner unless -

(a) the builder has complied with this section; or

(b) VCAT is satisfied -

(i) that there are exceptional circumstances or that the builder would suffer a significant or exceptional hardship by the operation of paragraph (a); and

(ii) that it would not be unfair to the building owner for the builder to recover the money.

(7) If subsection (6) applies, the builder is entitled to recover the cost of carrying out the variation plus a reasonable profit.

(8) This section does not apply to contractual terms dealing with prime cost items or provisional sums.

1. The High Court considered the operation of s 38 of the DBC Act in Mann v Paterson[14] ('Mann'). In that case, Nettle, Gordon and Edelman JJ held, at [154], that:

s 38(6) of the DBC Act provides that a builder is not entitled to recover "any money" in respect of a variation asked for by a building owner (other than for prime cost items and by way of provisional sums), unless either the builder has complied with "this section" or VCAT is satisfied of the matters prescribed by s 38(6)(b).

1. Given the terms of s 38(5), the requirement in s 38(6) for the builder to have complied with "this section" is met only if:

(a) the owner has given the builder a notice in writing in accordance with s 38(1) and the builder has complied with s 38(3) by giving the owner a notice in writing in accordance with s 38(3)(a) within the reasonable time prescribed by s 38(4); or > > (b) the owner has given the builder a notice in writing in accordance with s 38(1) and the builder satisfies the requirements of s 38(2) in that the builder reasonably believes the variation will not require variation to a permit, cause any delay or add more than 2% to the original contract price stated in the contract.

If one or other of those conditions is satisfied, and the plans or specifications are so varied, s 39(b) provides that the contract price is taken to be the price as adjusted to take account of the variation.

1. By contrast, if neither condition is satisfied, then, perforce of s 38(6)(b), the builder is not entitled to recover any money in respect of an owner-initiated variation (other than for prime cost items and by way of provisional sums) unless VCAT is satisfied:

(i) that there are exceptional circumstances or that the builder would suffer a significant or exceptional hardship by reason of the builder's failure to comply with s 38 in either of the two respects mentioned above; and

(ii) that it would not be unfair to the building owner for the builder to recover the money.

If VCAT is so satisfied, then s 38(7) has the effect that the builder is entitled to recover the cost of carrying out the variation plus a reasonable profit.

1. Mr Kasho did not suggest that in respect of any of the variations Mr Kako had provided written notice in accordance with s 38 (1) of the DBC Act. It was not suggested that he had, on behalf of the builder, responded with a notice under s 38(3), or that he had purported to rely upon the "2% rule" embodied in s 38(2). It follows that in order to recover payment, the builder must satisfy the Tribunal that there are exceptional circumstances or that the builder would suffer a significant or exceptional hardship if the variation is not allowed, and that it would not be unfair to the building owner for the builder to recover the money. With these principles in mind, I will turn to a consideration of the individual variations shortly.
2. Before I do so, it is necessary to identify the documents incorporated into the contract as they form the base against which variation claims are to be tested.

1. It is common ground between Mr Kasho and Mr Koka that plans were incorporated into the contract. Mr Kasho refers to the plans in his witness statement at [11] where he deposes that the contract referred to drawings that Mr Koka had commissioned Windrock to prepare. The contract refers to plans dated 9 June 2013 prepared by Windrock.

1. It is also agreed between the parties that there was a specification in the contract. Mr Kasho refers to the specification in his witness statement. At [10] he deposes that on 27 September 2018 he went through his company's standard specifications and put prices against every item. The specification is referred to in the contract as a seven page document prepared by the builder. It is appended to Mr Kasho's witness statement. It is typed on the letterhead of his company, and is headed "Standard Lists of Inclusions". I accept that it constituted the contract specification.

1. Mr Koka's agrees that the "Standard Lists of Inclusion" formed part of the contract. For instance, he refers to it in his witness statement at [31] where he says that his evidence regarding his complaint about the windows. It deposes that the windows were discussed with Mr Kasho on 27 September 2018, which is the same day that he said he signed the contract and the Lists of Inclusions. However, Mr Koka did not address the specification, nor the plans in the early paragraphs of his witness statement in which he discussed the formation of the contract. I note that the specification is not included as an exhibit to Mr Koka's witness statement. However, apart from the plans and specification, no other documentation is referred by him as forming part of the contract.[15]

Extra Cost for removing stone for underground drainage $1,980

1. Mr Kasho made no reference to this variation in his witness statement. Although a transcript was prepared in respect of the entire hearing, he made no reference to the transcript in support of this variation in his final submissions. In these circumstances I am not satisfied that there was a variation. This particular claim is dismissed.

1. Mr Kosha's evidence about the fireplace appears in his witness statement at [38(a)] where he notes that there is no fireplace in the contract specification. He alleges that on 7 January 2019 Mr Koka called him from a shop where he was proposing to buy a fireplace. He asked to use the builder's account so he could secure a discount. Mr Kasho says it was agreed that if he paid for the fireplace Mr Koka would pay him for it later. Mr Kasho deposes that he paid a $2,000 deposit and sent a text to Mr Koka asking him to pay his share of the balance when it was due. Mr Kasho exhibited the relevant text to his witness statement.
2. I am satisfied that Mr Kasho is telling the truth, and I find that the fireplace was ordered as a variation to the contract. The total cost of the purchase of the fireplace was $6,000. Mr Kasho says that installation cost $700, which appears to me to be a reasonable figure. I am satisfied that if Mr Koka does not pay the variation of $6,700, the builder will suffer significant hardship. I note in this connection that the Court of Appeal in Jolin Nominees Pty Ltd v Daniel Investments (Aust) Pty Ltd [16] confirmed that it is legitimate to take financial hardship into account the purposes of s 38(3)(b)of the DBC Act. At [47], the Court of Appeal held:

(48) The 'significant or exceptional hardship' suffered by the builder is that occasioned by the 'operation' of s 38(6)(a) of the DBCA. Section 38(6)(a) operates to preclude the builder from 'recover[ing] any money' unless the builder has given the relevant notice. The hardship is therefore directed to the builder's inability to recover any money.

1. I also find that as Mr Koka will have the benefit of the fireplace which has been installed in his home, it is not unfair that that the builder recover money in respect of the variation. I am satisfied that the relevant criteria set out in s 38(3)(b) have been satisfied, and I will allow the variation at $6,700.
2. I acknowledge the concern that Mr Koka expressed about the exhaust exiting out of the side of the house in his witness statement, at [45]. Mr Koka deposed "This look very bad and prevented access, as you would need to duck under the fireplace exhaust if you want to walk around the house".
3. However, that concern arises from Mr Koka's action in selecting the fireplace after the works had got underway. It is not a matter which can be taken into account in assessing the builder's entitlement to this variation.

1. Mr Kasho's evidence about the basin taps appears in his witness statement at [38(b)] where he deposed:

When the plumber started roughing in, Ayad brought five basin taps that fixed inside the wall. The plumber requested an extra $150 to install each unit as it was not provided for under our specification. Ayad and I agreed that Ayad would pay $750 to the plumber to carry out these works. Ayad subsequently provided details to the plumber and supervised these works personally.

1. In support of his evidence, Mr Kasho exhibited a copy of a text message received from the plumber on 15 May 2019 confirming the installation of the mixers. On the basis of this evidence, I accept that there was a variation. I am also satisfied for the purposes of s 38(3)(b )of the DBC Act that the builder will suffer significant hardship if the variation is not paid for and that it would not be unfair to Mr Koka for the builder to recover money in respect of the variation. I will allow the variation at $750.

1. Mr Koka, in his witness statement, gave evidence about the retaining wall that included the following statements:
   1. Nisho [Kasho] came to me on or about 17 December 2018 and told me that there was a big problem and that we needed to find a solution. He told me that if we couldn't find a solution, I would need to pay over $15,000 for the garage wall to be knocked down and for a new double brick wall to be installed.
   2. I was shocked and asked him what the problem was. He informed me that the garage was too low and the building surveyor would not pass the garage. I told him that was not my fault, and this is his mistake.
   3. Nisho suggested we put a retaining wall behind the garage as this would be the cheapest solution. Nisho sent me a letter to forward to the neighbour to advise the neighbour we would be putting in the retaining wall. ..... Nisho proceeded to install the retaining wall without the permission of the neighbour. Nisho was interested in burying the problem quickly.
   4. 37. At the time this issue was addressed I didn't quite understand what was going on and didn't really understand the "Written Direction to Fix Building Work" that was issued by the surveyor, based on Windrock Group engineering advice. Attached is a letter sent on 16 December 2018 to Nisho from the engineer in ANNEXURE AK3 Nisho forwarded me this letter via email on 18 December 2018.
   5. Nisho installed the retaining wall behind the garage in order to avoid knocking down the garage wall and relaying a double brick wall as detailed earlier in my statement. Nisho wanted to do a cheap quick fix as the property had been issued with a notice to fix works by the surveyor.
2. It is clear from these statements that the question of whether the variation was necessary in relation to the retaining wall is directly related to the question of whether it was Mr Koka or the builder was responsible for the site being cut at the wrong level.
3. Mr Kasho's evidence about this is contained in his witness statement, from [14]. At the time the building permit was issued on 15 October 2018 he was in China. Mr Koka wanted he project started as soon as possible. Mr Koka engaged Kings Excavation to do the site cut so that the site would be ready for the builder when Mr Kasho returned. This fact is not an issue. Mr Koka in his own witness statement, at [13], confirms that he paid $7,000 in cash directly to what he terms the "earthworks contractor". Mr Kasho deposes as to what happened when he returned from China as follows, at [16]:
   1. I asked Ayad about the garage step down, which was cut 300mm lower than the rest of the site. He explained that, as the site was full of big rocks it would have been very expensive to cut the site to the level as per plans, so he had decided to cut down the garage only and put an extra step in between the garage and the main house. Ayad wanted his garage to be lower than the driveway so the garage wouldn't be too steep, to allow him to easily drive and park his car in the garage. The garage is 5m from [the] footpath and 1.3m high so the driveway would be very steep if the site was not cut down.
   2. As I didn't want to start works if the site cut was out of level, I asked Ayad to certify the site cut by an engineer prior to commencing works. On 2 November 2019, the [Windrock Group] subsequently sent a letter stating that they had no issue with the garage stepdown, and that works could proceed as planned.
4. Mr Koka acknowledges that he made arrangements with Kings Excavation to carry out the site cut under his supervision while Mr Kasho was out of the country without reaching any prior agreement with Mr Kasho. Mr Koka also paid the civil (or "earthworks") contractor directly, also without communicating with Mr Kasho. In these circumstances I am satisfied that this part of the works was taken out of the contract. The site cut in this way became the responsibility of Mr Koka.
5. As it is clear that the need to create a retaining wall behind the garage arose because of the fact that the level of the site meant that the garage had been constructed lower than had originally been planned, I find that the retaining wall was created by the builder as a direct and appropriate response to the situation which Mr Koka had created. I note that the cost claimed is $960, which appears reasonable for a brick retaining wall. I also find that the builder will suffer a significant hardship if it does not recover the cost of the variation, and that it would not be unfair to Mr Koka if the builder were to recover payment for the variation. I will allow $960 for the retaining wall variation.

Removing the walls and sliding doors in bathroom and pantry $2,000

1. Mr Koka, at [33] of his witness statement, deposed:

I noticed all the cabinetry in the walk-in pantry was installed incorrectly and did not match what was in the plan. A cesar stone bench top was supposed to be all around the pantry; however, it was only installed on one side. The fridge location was wrong and none of the cupboards were correct as pictures and outlined in the Darbecca and Master Property Inspections report. The plumbing for the fridge could not reach the fridge as it was in the incorrect compartment and the cupboards doors could only partially open. All the cabinetry in the pantry was a mess. Nisho was well aware; however, refused to fix the defects and simply ignored me.

1. Mr Kasho addressed these issues together with a number of other items at [38(c)] of his witness statement. He deposed that after the carpenter had finished work Mr Koka asked him to do a number of things including removing the cavity door in the kitchen pantry because the refrigerator Mr Koka wanted to install would not fit through the pantry door.
2. I am not satisfied that the works referred to by Mr Kasho are true variations. Mr Koka gave evidence at [27]-30] about this issue. In summary, he said that he received advice from the architect that the pantry had been designed with a doorway of 820mm which would have been large enough to fit the refrigerator. Mr Coco said he measured the door himself, and it was too small. I accept that further work was carried out on the pantry door by the builder, but I do not accept that it was necessarily variation work. It was probably merely rectification work. I dismiss this claim

1. Mr Koka deposed his witness statement as follows:
   1. Two bulk heads were installed by mistake. One in the kitchen and one in the entry. As Nisho very rarely came to the site, he didn't realise this until after the plaster was installed.
   2. I asked why these bulk heads was here and he said the tradies installed them in error. As it did not suit the appearance of the house, I asked for them to be removed. Nisho said that they would be too difficult and expensive to remove. He said he will add a third bulk head to balance out the appearance of the bulk heads and to trust him that it would look nice. He said that if it did not look nice; then he would remove both additional bulk heads.
   3. After, he installed the third bulk head I didn't like the way it looked and asked him to remove the two additional bulk heads that were not part of the plan. He refused and said everything was finished and he would not remove the bulk heads. He said if I wanted them removed, I had to do it myself after he handed over the house.
2. Mr Kasho disputes this account. At [38(c)] he deposes that one of the things Mr Koka asked the carpenter to do after the carpenter had otherwise finished was to build bulkheads in the corners of the hallway entrance. Mr Kasho states:

No bulkheads were installed by mistake, only at Ayad's direction. Bulkheads incur additional cost, so I would not have installed them without a direction from Ayad.

1. The conflicting evidence of Mr Koka and Mr Kasho regarding the bulkheads must be viewed in the context of other evidence in the case by which it was established that there was a history of Mr Koka going to the site and giving directions to the builders' trades. There is evidence that Mr Kasho called Mr Koka out on this.[17] On the basis of this evidence, it is quite credible Mr Koka gave directions directly to the carpenter to construct extra bulkheads. I accept the logic of Mr Kasho's statement that there would be no reason for him to install bulkheads without a direction for Mr Koka, because extra cost is involved.
2. I am accordingly satisfied on the balance of probabilities that Mr Koka did direct the builder's carpenter to erect the extra bulkheads. I accept that the extra work constituted a variation to the plans and specification and that the claimed cost is reasonable. I find that if the variation is not allowed, the builder will suffer a significant hardship. I also find that it is not unfair for Mr Koka to have to pay for the variation as he has the continued benefit of the bulkheads. I will award $800 for the bulkheads in the hallway.

1. Mr Kasho does not address the air-conditioned variation in his witness statement. I dismiss this claim.

Changing tile laying from 600mm long tiles to 1200mm long tiles and laying extra tiles in toilets and laundry $6,000

1. Mr Kasho's evidence in relation to this issue is found in his witness statement at [38 (h)]. He relevantly deposed:

Another issue related to tiling. The tile size set out in the specification was 600x600 mm, but when Ayad went to choose the tiles, he chose 1200x600 which is more expensive and cost more to lay. He said he was going to pay the difference.

1. Mr Kasho's was quite right in highlighting that the specification called for 600 x 600 tiles.[18] I find that there was a variation in relation to the change of tiling. However, this is not the end of the claim for a variation. Mr Kasho went on to say:

In or around 29 January 2019, the tiler finished floor tiling. In the evening Ayad sent a text asking me to not let anyone pass into the house as he wanted it to be dry 100%. Later on, I found out that he and his family went inside while the tile is newly laid, and ended up changing most of them.

1. Mr Kasho's evidence that Mr Koka went into the house with his family while works were still underway must be viewed in the context of other evidence of Mr Koka's propensity to enter the site, which was discussed in the Reasons at [41]. On the balance of probabilities, I am satisfied that Mr Koka and his family did re-enter the house and I accept Mr Kasho's evidence that on this occasion they damaged the tiles which had recently been laid by the builder's tiler.
2. Mr Koka disputed liability for the variation but did not specifically dispute its costing. I am prepared to accept $6,000 as the cost of the variation. I find that if this sum is not awarded then the builder will suffer significant hardship. It is not unfair for Mr Koka to pay for the variation. I accordingly find that the requirements of s 38 (3)(b) have been met and I will award $6,000 to Mr Kasho in respect of the tiling.

1. The builder installed a steel lintel over the sliding doors. There is evidence that the design of the lintel had to be checked by Mr Koka's engineer.[19] However, this of itself does not establish that the steel was a variation. In the absence of other evidence, I dismiss this claim.

1. Mr Koka, in his witness statement at [50], deposed that the plaster was not level and was bulging. He went on to say that the builder did not fix the plaster defects, and after termination he had to engage a contractor to install new plaster. This claim is discussed below.
2. Mr Kasho gave no evidence about any variation to the plasterwork. I accordingly will disallow this particular claim.

1. Mr Kasho gave evidence in relation to the painting at [38 (d)] of his witness statement. He said:

In respect to painting works, Ayad initially engaged Naij from Master Class Painting works, a relative of Ayad's who had previously worked for Nerwa Constructions a few years earlier. Naij and I agreed that the cost of the painting works would be $8800, pus one day labour plus plastic materials to provide floor cover while works were performed. Ayad, however, asked him to paint all doors mirror with a mirror paint finish and perform other additional works on the basis that he would pay him the difference in price.

1. Mr Koka had an opportunity to address the painting variation in his witness statement but did not do so. In these circumstances, I accept Mr Kasho's evidence that the scope of the painting was increased. Mr Koka said nothing about the quantification of this variation and accordingly I accept that $3,300 is a reasonable cost.
2. I accept that if this sum is not paid the builder will suffer significant hardship. It would not be unfair if Mr Koka had to pay the variation, as he has the benefit of enhanced painting with a mirror finish together with an increased scope of painting. I will award $3,300 for this variation.

1. Mr Kasho give evidence about this issue in his witness statement, at [38(e)] where he said:

Ayad requested multiple changes to the design of kitchen cabinets directly to the cabinet maker, Selwan Putrus of BKS Centre Ply Ltd, which had the effect of completely changing the scope of the design work involved. Among other things, Ayad asked for: i. the top kitchen cabinets to extend to the ceiling (2.7m), whereas the plans provided for 2.4m; and ii. All the wardrobes to extend up to the ceiling, as compared to 1.8m in in the plans. I called Ayad asking why he changed the kitchen design as the price would double. He said that he would pay the cabinet maker the difference and asked us to continue work as per the revised specifications.

1. Mr Kasho referred to a letter from the kitchen cabinet maker Selwan Putrus dated 8 September 2021, confirming that Mr Ayad (Koka) had come to his factory and asked him to do a new design which was different to that on the architectural plans.[20]
2. In these circumstances, I am satisfied that Mr Koka directed a variation to the kitchen cabinets by instructing the subcontractor himself.
3. Mr Koka disputed liability for the variation, but not the quantification. I accept the figure of $4,800 as it appears reasonable for a change to the kitchen cabinet design. I am satisfied that the builder will suffer hardship if the variation is not paid, and that it would not be unfair to Mr Koka if he had to pay for it. I will award $4,800 for the variation.

1. The specification set out following detail about the kitchen:

60mm caser stone bench Calcutta (Statuari0 Signature 1463) top & Standard Board doors & handles from builders range.

1. Mr Kasho gave evidence about this issue in his witness statement at [38 (f)]. He stated:

Ayad also ordered waterfall stone for both sides of kitchen bench and an undermount sink for kitchen which was not in the plans and specifications. As a result, the price for stonework increased significantly from what was originally specified in the works.

1. As the specification clearly called for a Caeser Stone benchtop, but not sides, Mr Kasho's claim that there was a variation for the sides is made out. I note that the stone sides, which are described as "waterfalls", are referred to in the relevant invoice from the stone supplier as a variation.[21]
2. Mr Kasho also said that there was a variation to the kitchen stone work because Mr Koka called for an underbench sink. This variation is referred to in the invoice from the supplier.
3. Insofar as the bathroom is concerned, the specification calls for a "caser" (presumably Caesar) stone top. No details were given by Mr Kasho regarding the alleged variation in the bathroom stone, but in the tax invoice from the supplier there is a reference to an underbench basin/trough.
4. Doing the best I can on the basis of the limited evidence, I will allow two variations in respect of the kitchen stone and one variation in relation to the bathroom vanity top. Liability was disputed by Mr Koka, but not quantification. I will allow the total value of the variation claimed of $3,600. For the purposes of s 38(3) (b) of the DBT Act, I am satisfied that if the variation is not allowed the builder suffer significant hardship. Given that Mr Koka will have the benefit of the varied stone work, it is not unfair that he should pay for the variations. I will award $3,600 for this item.

1. The specification called for "Polished edge mirror to bathroom & on suite (sic)."
2. Mr Kasho gave no evidence as to why the specification had been varied. I dismiss this claim.

1. The specification provided for electrical "As per plans plus alarm and colour intercom."
2. Mr Kasho did not detail why there had been a variation to the electrical works. This claim is dismissed.

1. The specification referred to external concrete in these terms:

Driveway as per plans and planned for the rest 1 meter around the house normal concret (sic).

1. Mr Kasho did not say why the external concrete had been altered so as to justify a claim for a variation. This claim is dismissed in so far as it relates to the concrete.
2. However, there was no mention in the specification of any alfresco plumbing. On this basis I accept that there was a variation for alfresco plumbing. Mr Kasho gave no details as to the cost of the alfresco plumbing, and accordingly I am constrained to award the minimum amount a plumber would be likely to charge for attending to site and installing a tap and basin, plus margin. I assess the sum at $500 plus margin of 25%, or $125. The total is $625. This is a substantial amount, and the builder will suffer a Certificate hardship if it is not paid. It is not unfair for Mr Koka to have to pay for the variation as he has the benefit of a plumbed installation in the alfresco area. I will award $625.

• Extra Cost for removing stone for underground drainage- $nil
• Fireplace and installation $6,700.
• Installing tap mixers inside the walls $750
• Retaining wall $960
• Remove the walls and sliding doors at bathroom and pantry $nil
• Bulkheads hallway $800
• Airconditioning system $nil
• Changing tile laying and extra tiles $6,000.
• Steel above the sliding doors $nil
• Plaster change $nil
• Painting $3,300.
• Kitchen and cabinets $4,800.
• Kitchen and bathroom stones $3,600.
• Bathrooms mirrors $nil
• Electrical $nil
• Alfresco plumbing and concrete $625

Calculation of adjusted contracts sum and the balance notionally due

1. As the contract sum was $363,000, the adjusted contract sum comes to $390,535. The total amount paid by Mr Koka before he terminated the contract was $235,950. When this sum is deducted from the adjusted contract sum, the balance notionally due to the builder is $154,585.
2. I now turn to the assessment of defects.

1. By order dated 28 August 2023 the Tribunal directed the parties by 26 September 2023 to confer in order to revise the Scott Schedule prepared by the builder. In respect of each defect, the parties were directed to indicate in which of the following categories the defect sat:

Category 1: defects clearly warranting a substantive award of damages;

Category 2: defects clearly warranting only a nominal award of damages; and

Category 3: defects not clearly sitting in either category.

1. Prior to the hearing on 30 October 2023, the parties filed submissions. Regrettably, there was almost no agreement between the parties as to where any particular defect sat. Mr Koka's lawyers identified in a Scott Schedule 41 defects which, it was submitted, clearly warranted a substantive award of damages. The damages to which Mr Koka was entitled, according to Mr Buchanan's fourth report of 8 July 2021[22], was $239,641. This report had been prepared on the basis of defects identified in the Darbecca and MPI reports. A further 17 items fell into the category of defects clearly warranting only a nominal award of damages. The total assessed by Mr Buchanan for this category was $7,990. The remaining 11 items fell into the third category, namely defects not clearly sitting in either category. The valuation of this category was $20,469.
2. According to Mr Kosa, there were no defects clearly warranting a substantial award of damages. Nine defects sat in the second category, namely defects clearly warranting only a nominal award of damages. The award justified in this category was $4,242.70. Mr Kosa considered that 66 items fell into the third category, being defects not clearly sitting in either category. Mr Kosa did not provide any assessment for the valuation of this category.
3. Because of this lack of agreement about almost anything about defects it has been necessary for me to review the defects claimed on an individual basis. This task was not made much easier by the submissions filed by the parties following the hearing regarding quantification of damages. The builder filed final submissions running to 13 pages that included a number of general points but only limited submissions concerning specific defects. The defects addressed included roof tiles, downpipes and gutters, walls, the level of the garage floor, the retaining wall in the garage, installation and brickwork. The builder's lawyers also filed reply submissions after final submissions had been filed on behalf of Mr Koka.
4. Mr Koka's final submissions made a number of general points, but in order "to maintain some degree of efficiency" made only limited comments about specific defects. The defect focused on were roof tiles, brickwork, the garage and windows. The submissions contained this statement, at [21]:

The owner relies on the evidence provided orally by the Owner, the Builder and the experts, and the written evidence contained in the Tribunal Book and tendered at the hearing regarding defects at the Owners property. The Tribunal also had the benefit of attending a view of the property, which many of the defects were clear for any casual observer to see.

1. In other words, except in relation to the roof tiles, brickwork, the garage and windows, the Tribunal was left to work out and substantiate Mr Koka's claim. In a case involving 7 hearing days it was very surprising that Mr Koka's final submissions referred to the transcript on a very limited number of occasions. Specifically, the transcript was referred to in relation to the major issues only but not the other defects. There were limited references to the transcript with a view to highlighting certain aspects of Mr Buchanan's evidence and there was a reference to the transcript concerning the builder's general entitlement to variations. There was also a single reference in relation to Mr Koka's entitlement to almost $58,000 worth of invoices allegedly paid to third parties in respect of the completion of works and rectification defects. The Tribunal Book contained 68 documents filling 4 ring-back folders. Mr Koka took a parsimonious approach to referencing his experts' reports. Overall, his approach might be described as courageous. However, in circumstances where it had clearly been demonstrated that Mr Koka had a limited grasp on his contractual responsibilities and entitlements, where Mr Koka's credibility was under attack on multiple issues, where there were clear gaps in his evidence regarding quantification of damages, and where he had failed to call trade contractors to substantiate his claims for damages in respect of payments made to third-party contractors, it may well be that his legal advisors considered that discretion was the greater part of valour.
2. At [82] of his final submissions, Mr Koka identified the damages he is seeking in individual defects. It will be necessary to go through each of these in turn. Before doing this, it is appropriate to set out the legal principles relevant to assessment of damages in a domestic building case such as this.

1. The general rule for the recovery of damages for breach of contract is that the innocent party is entitled to be put in the same position as they would have been had their contract been fulfilled, as illustrated by the High Court in Bellgrove. In that case the owner, Ms Eldridge, brought an action for damages for breach of contract against a builder, asserting that the builder had substantially departed from the specifications, and that, by reason of such departure, the foundations were defective and the building was unstable. The High Court held that the owner "was entitled to have a building erected upon her land in accordance with the contract and the plans and specifications which formed part of it, and her damage is the loss which she has sustained by the failure of the appellant to perform his obligation to her." However, the High Court acknowledged that there was an exception to that rule, namely "that, not only must the work undertaken be necessary to produce con-formity, but that also, it must be a reasonable course to adopt".
2. The extent of that exception was examined by the High Court in the later case of Tabcorp Holdings Ltd v Bowen Investments Pty Ltd [23] (Tabcorp). That case concerned a claim for damages by a landlord as a result of breach of a covenant in the lease by the tenant carrying out work, which resulted in the substantial remodelling of the foyer of the leased building without the approval of the landlord. The trial judge held that there had been a breach of covenant, but awarded damages in the sum of $34,820, being the difference between the value of the property with the old foyer, and the value of the property with the new foyer constructed by the tenant. On appeal, the Full Court of the Federal Court of Australia had increased the judgment sum to $1.38 million, made up of $580,000 to reflect the cost of restoring the foyer to its original condition, and $800,000 for loss of rent while the restoration work was taking place. The High Court upheld the decision of the Full Court.
3. In doing so, the High Court emphatically rejected the proposition that a party entering into a contract was at complete liberty to break the contract provided damages adequate to compensate the innocent party were paid - in the Tabcorp case being damages in the amount of the diminished value of the landlord's reversionary interest. Rather, the High Court reaffirmed the 'ruling principle' [13] that the measure of damage at common law for breach of contract was that stated by Parke B in Robinson v Harmon [1848] EngR 135; (1848) 1 Exch 850, 855; [1848] EngR 135; (1848) 154 ER 363, 365:

The rule of the common law is, that where a party sustains a loss by reason of a breach of contract, he is, so far as money can do it, to be placed in the same situation, with respect to damages, as if the contract had been performed.

In Tabcorp, the High Court also elucidated and explained the qualification of 'unreasonableness' established by its earlier decision in Bellgrove. It established that this qualification is only to apply in 'fairly exceptional circumstances ... only ... where the innocent party is "merely using a technical breach to secure an uncovenanted profit"...' [17] (quoting from the judgment of Oliver J in the English case of Radford v De Froberville (Radford)[24].

1. Another case worthy of mention is the decision of the Full Court of the Supreme Court of South Australia in Stone v Chappel[25] (Stone) in which the Court explored when the test of "unreasonableness" expounded in the High Court in Bellgrove will be enlivened. As was noted in that case by Doyle J, "as the law currently stands, there had to that point been no express identification in the Australian case law of any principle or policy underpinning the notion of unreasonableness."[26]
2. In Stone, Kourakis CJ observed, at [54]:

The Bellgrove qualification that rectification must be a 'reasonable course' to adopt is calculated to control the level of damages and to address those cases in which the prima facie rule produces a result which is manifestly unjust. It is not limited to the question of mitigation in the sense of awarding damages for that method of rectification which best mitigates the loss. It is a qualification which allows the selection, in special circumstances, of an alternative measure of damages. The qualification reflects two methods often employed by the common law. First, in recognition that a sound general rule may nonetheless still work an injustice in a particular case, it qualifies the general rule with a proviso. Secondly, it translates what is, at base, a determination of legal policy into a quasi-factual question by engaging the reasonableness standard. The reasonableness of rectification is not determined by an entirely factual enquiry. The test of reasonableness is only quasi-factual and imports a normative standard.

Rectification damages are awarded for a breach of a building contract unless there is good reason to adopt another measure because the award of rectification damages would be manifestly disproportionate to the attaining of the contractual benefit. That rule entrenches rectification costs as the primary measure of damages and emphasises the exceptional nature of any lesser award. In determining whether good reason exists, the authorities suggest that the following are relevant considerations:

(1) the degree of departure from the contractual stipulation;

(2) the adverse effect of the departure on the functional utility, amenity and aesthetic appearance of the building;

(3) the reasons, objectively ascertained and commonly known, for which the innocent party made the stipulation which was breached;

(4) the practical feasibility of rectifying the work, including the effects on third parties of attempting to do so;

(5) whether or not the innocent party intends to carry out the rectification work;

(6) the absolute cost of the rectification work and the disproportion between that cost and

• the value of the building and contract price;
• the diminution in commercial value of the building;
• the effect of the departure on the functional utility, amenity and aesthetic appearance of the building;

(7) the nature of the wrongdoer's fault for the defect; and

(8) the public interest in reducing economic waste.

1. In his judgment in Stone, Doyle J stated, at [255]:

In determining what is a reasonable, the issue is one to be determined objectively, there being no suggestion that the plaintiff should be the arbiter of his or her reasonableness. However, the determination must take place in the context of the relevant contract, and hence by reference to the plaintiff's needs and desires reflected in the bargain he or she struck.

1. Doyle J went on to identify from a survey of the authorities several matters relevant to determining the reasonableness of rectification costs claimed. These included:
   1. the proper identification of the claimant's performance interest, that is to say, the benefit bargained for;
   2. a consideration of the extent to which the defendant has, despite departure from the contractual standard, nevertheless achieved the contractual objective, and hence provided the plaintiff with the benefit he or she bargained for;
   3. any lack of proportionality between the proposed work and cost, and the benefit to be achieved by the plaintiff through this work;
   4. the plaintiff's intention and ability to carry out the rectification work, although he noted that these considerations are not usually decisively relevant in their own right;
   5. it may be that in cases where the defendant's breach is intentional, or profit driven, that the Court may be more reluctant to deprive the plaintiff of rectification damages designed to protect his or her performance interest.
2. I highlight that Doyle J, like Kourakis CJ, emphasised the importance of some proportionality between the cost of the proposed rectification work and the benefit to be achieved by the owner by the performance of this work. This consideration is relevant to a number of the claims made by Mr Koka.

1. I now turn to a discussion of the defects which Mr Koka contended existed. The first group of defects-up to and including 37.6 below- were identified by Mr Patrick Kerr of Darbecca who was one of the building experts called by Mr Koka. Mr Kerr's was called and adopted his report dated 1 May 2019 (the 'Kerr report').[27] This report was seminal. Some of the defects identified by Mr Kerr were still present after Mr Koka had taken possession and carried out work on the house.
2. Mr Hayden Sherwood of Darbecca inspected the property on 21 June 2019 and prepared a report dated 22 June 2019 which he adopted at the hearing.[28] Mr Sherwood inspected the property again on 3 July 2019. He produced a further report on the same day which also went into evidence.[29] The purpose of the report apparently was to comment on defects and observations arising from the fixing inspection conducted on 1 May 2019. Mr Sherwood also adopted a third report at the hearing, this time dated 12 December 2019[30] (Mr Sherwood's third report). This report was prepared on the basis of a post-occupancy inspection, by which time the owner had finished the dwelling. The report was based on the same inspection- 3 July 2019-that Mr Sherwood's second report had been based on.
3. The defects which were still in existence were also the subject of comment by Mr Les Camilleri of MPI who inspected the property on 2 July 2021. At the hearing Mr Camilleri adopted his report dated 8 July 2021.[31]
4. Mr Koka called a fourth building expert, Mr Raja Chidhambaram, a civil engineer, who attended the hearing and adopted a report he had prepared dated 21 June 2021.

1. The cost of rectification of defects and completion of the works was performed on behalf of Mr Koka by Mr Douglas Buchanan, a very experienced quantity surveyor. Mr Buchanan attended the hearing to give evidence, and adopted his report dated 5 February 2021.[32] Unless noted otherwise, the costings relied on by Mr Koka are based on Mr Buchanan's opinions.
2. The builder relied partly on the expert testimony of a forensic architect, Mr Stephen Kosa. Mr Kosa attended the hearing and adopted a report he had prepared dated 15 October 2019.[33] Mr Kosa also adopted a supplementary report he prepared dated 11 December 2019, in which he set out costings.[34]
3. The builder also relied, indirectly, on instructions given by Mr Kasho to Mr Kosa before the damages hearing on 30 October 2023. The thrust of this evidence was that if the builder had been allowed by Mr Koka to complete the work, he would have relied on his tradespeople and subcontractors to come back and rectify any defective work at no charge.
4. I have several difficulties with this evidence. First, it was not evidence contained in Mr Kasho's witness statement, and he was cross-examined about it at the substantive hearing. Second, it was hearsay evidence presented to the Tribunal through Mr Kaso. Although the Tribunal is not bound by the rules of evidence, it is bound by the rules of natural justice, and because this further evidence of Mr Kasho was expressed through the voice of Mr Kosa, Mr Koka did not have opportunity to cross-examine Mr Kasho about it. Third, I have a concern about the reliability of the evidence.
5. The point here is that none of the relevant trades were called by Mr Kasho and so they could not be asked about whether they would have been prepared to come back to site without payment to rectify allegedly defective work, or whether they would have been prepared to return to the site to complete work without payment. As I observed to Mr Kosa during the damages hearing, there might be a number of reasons why Mr Kasho could not rely on a tradesperson who had originally worked on the job to come back to site. They might have gone out of business, become sick, gone bankrupt, disappeared, or simply refused to cooperate.
6. When Mr Buchanan was asked by Mr Fink if he accepted that for some items the subcontractors would charge nothing to the builder to fix mistakes or to complete work, he responded by saying he would expect them to rectify at no cost if they accepted that they had made mistakes.[35] In other words, their agreement would be highly conditional.
7. Taking these reasons together, I place no reliance on Mr Kasho's submission that he could have got all the defects rectified and all the uncompleted work completed, for no cost.

The builder's attack on Mr Buchanan's evidence

1. Mr Fink, on behalf of the builder, made two attacks on Mr Buchanan's evidence about costings at the damages hearing on 23 October 2023.
2. The first submission was that Mr Buchanan's evidence was irrelevant because he had provided costings in four reports issued in 2021. Mr Fink said the evidence was irrelevant because the Tribunal's orders dated 25 October 2023 required the parties to file and serve further expert reports concerning the cost of rectification work or completion work would have been to the builder at the time of termination of the contract in June 2019. Mr Buchanan's reports were irrelevant as they were based on rates applicable in 2021 rather than in June 2019.[36] I consider that there is some attraction in this submission, but I note Mr Buchanan's evidence at the damages hearing was that "The rates that I would have applied in 2019 would have been lower, slightly, but not significantly."[37] Accordingly, I am not satisfied that Mr Buchanan's 2021 costings are irrelevant. They will be of use, provided some adjustment is made for inflation between June 2019 and July 2021, which is the date of the last of Mr Buchanan's reports.
3. Mr Fink's second attack on Mr Buchanan's evidence was premised on the Tribunal's determination that Mr Koka's entitlement to damages was to be assessed taking into account the cost of the builder of rectifying defects and completing the works. The issue identified with Mr Buchanan's was that he had costed of the performance of rectification and completion on the basis that it would be carried out by an independent contractor, rather than be carried out by the builder.[38] The significance of this was that an independent contractor would add a loading for preliminaries and builder's margin. This clearly was a fair point, as Mr Buchanan's worksheets disclosed the addition of preliminaries and builder's margin. In his fourth report dated 8 July 2021, the loadings used were 10% for preliminaries and 15% for builder's margin.
4. In my view, this issue with Mr Buchanan's evidence can be dealt with simply, by stripping out from his costings the loadings for preliminaries and builder's margin.

Removal of loadings for preliminaries and builder's margin

1. The relevant adjustment to be made in respect of each of the items where Mr Buchanan has allowed preliminaries of 10% and margin of 15% is to take 25% of his total assessment.

1. An adjustment is also to be made to allow for inflation on the domestic building site in Victoria between the date of termination, June 2019 and the date of the final Buchanan report, July 2021. In other cases, I have taken official notice of the impact of inflation on domestic building sites in Victoria. In the present case, I have the benefit of Mr Buchanan's concession that prices in 2019 would have been slightly lower than in 2021, but not significantly.
2. Mr Kosa was asked at the hearing about inflation also. He opined that in 2019 and 2020 it was fairly stable, but started to rise in 2021. In 2022 and 2023, inflation was "going gangbusters". He later qualified that statement by indicating that there had been increases of at least 10% or 20% on 2019 rates.[39]
3. Mr Buchanan was asked at the hearing to comment on the rises after July 2021. He referred to indices published by Rawlinson's, and indicated that they demonstrated a 15% increase in average costs after July 2021.[40]
4. Doing the best I can on the limited evidence available, I accept that Mr Buchanan was justified in saying that trade prices overall had slightly, but not significantly, increased between 2019 and 2021. Mr Kaso's evidence supports this opinion.
5. It is fair that I apply some loading for inflation. I will apply a loading of 2.5% per annum between June 2019 and July 2021, which I round off to a total loading of 5%.

1. In relation to any item where Mr Buchanan has allowed preliminaries and builder's margin, 25% is to be deducted.
2. Because of the impact of inflation all the best abilities are between June 2019 July 2021, a further adjustment of 5% for inflation is to be made. This increases the total deduction to 30%.

1. Finally, we come to the impact of GST. Mr Buchanan had added 10% for GST on base figures which are 30% higher than the figures I propose to adopt. This means a further 3% deduction must be made.
2. The outcome is that where I adopt Mr Buchanan's costings below as the underlying basis for assessing damages in respect of any particular item, I will reduce the figure by 33% (rounded to a neat one third for ease of calculation) to arrive at an assessment of the cost to the builder of rectifying or completing the item in June 2019.
3. I now turn to a discussion of each of the defects and incomplete items and the assessment of damages for those items.

1 Parts of the vapour barrier has been allowed to fall down below FGL (finished ground level)

1. The defect identified by Mr Kerr was the in parts around the dwelling, the vapour barrier had been allowed to fall below the FGL (for Finished Ground Level). Rectification was costed by Mr Buchanan in $1,268.[41] Mr Kosa rejected Mr Kerr's opinion regarding the existence of the defect, noting that the finished ground level was determined by Mr Koka.
2. The evidence disclosed that Mr Koka had subsequently incorporated the lower edge of the vapour barrier into paving he had laid around the dwelling. In these circumstances rectification was not feasible and in my view was certainly not a reasonable course to adopt. I allow the for this alleged defect.

1. The defect identified by Mr Kerr in his report was that downpipes had been installed to most of the pops in the gutters but some had come away from the pops or had been removed by trades. Some downpipes also did not have a stormwater point available below. This defect was costed on behalf Mr Koka by Mr Buchanan at $1,227 but Mr Kosa for the builder assigned no valuation to it. This is because when Mr Kosa inspected the site, all the downpipes had been connected.
2. Clearly, Mr Koka had arranged to have the downpipes reattached to the gutters and connected to the stormwater drain. Mr Koka in his witness statement, at [130], referred to making payment of $450 inclusive of GST to CB Top Notch Roofing for the installation of two drainpipes. The relevant invoice was tendered.[42]
3. I accept this defect was rectified and associated incomplete work completed at a cost of $450 to Mr Koka, and I will allow damages in this sum.

3 No articulation joints to front face of dwelling

1. Mr Kerr found that no articulation joints had been provided to the front face of the dwelling. The cost of rectification was assessed by Mr Buchanan on behalf Mr Koka at $1,674.
2. Mr Kosa accepted there was a defect in his first expert report,[43] and accepted that articulation joints should be provided in accordance with the engineering drawings or at a maximum of 6 m intervals. He costed the rectification work in December 2019 and again in October 2023. The October 2023 costing, inclusive of preliminaries, margin and GST, was $745.36.
3. Mr Buchanan based all his costings on rectification work scoped by others. He did not attend the site. Mr Kosa on the other hand attended at the site and prepared a report on defects and then later costed any rectification work he thought was necessary. For this reason, in respect of this particular defect, I prefer Mr Kosa's costing.
4. Accordingly, for this defect, I will allow $745 (rounded down).

1. The defect identified by Mr Kerr was that the water pipe into the dwelling entered at the base of the brick wall. The recommended method of installation was to enter through the slab but exit within the timber wall frame. The method used by the builder was problematic because the pipe would not be covered by landscaping and would both be unsightly and would be liable to break down in UV light over time.
2. Rectification had been costed by Mr Buchanan at $271. Mr Kosa allowed nothing to the defect on the basis that the perimeter of the house was required to be paved by the specification. The defect had accordingly been identified at a time when the builder had not completed its work. Mr Kosa considered that paving would cover the associated pipework and would thus overcome the problems identified.
3. I note that Mr Koka's claim for reimbursement of the invoice from the concreter who carried out the construction of the pavement is dealt with below.

1. Mr Kerr found that some areas around the dwelling sloped towards the slab in a manner which was not compliant with the Building Code of Australia ('BCA') section 3.1.2.3. The rectification was costed by Mr Buchanan at $1,016.
2. Mr Kosa allowed nothing for this defect. He noted that the specification mandated that the perimeter of the house was to be paved. Clearly at the time of his inspection, the builder's work was incomplete.
3. I accept that no defect has been established.

1. This is the first of a number of claims made about defect in the brickwork. It was submitted on behalf of Mr Koka that there was consensus amongst the experts of the brickwork was defective.[44] I accept the submission as the brickwork was a category of defect where Mr Kosa did agree with Mr Koka's experts.
2. A number of the issues with the brickwork could have been resolved by rendering those areas of the house where the brickwork had not been rendered. However, the specification only called the part of the house to be rendered, and this supports the submission made on behalf of Mr Koka that he had wanted part of the house to be rendered for aesthetic purposes. That the preservation of the rear external walls of the house as unrendered brick was important Mr Koka is evidenced by the fact that he chose to have some brickwork cleaned but not rendered.[45] This being the case, he was entitled to get what he contracted for under the Bellgrove principle. This determination is consistent with the approach taken by the Court of Appeal in Western Australia in Willshee v Westcourt Ltd,[46] where the Court assessed damages on the basis that the owner was entitled to receive a house clad with high quality limestone as his contract required.
3. It follows that Mr Koka is entitled to damages in respect of defects in the brick work.
4. Although Mr Koka had had some work done on the brickwork, he sought to rely on Mr Buchanan's costings in respect of defects and brickwork which had not been rectified. The defects concerned include 6, 7, 11, 14, 16, and 17.[47]

1. Mr Kerr remarked that AS 3700 called for perpends of 10 mm but allowed for maximums of 20mm and minimums of 5 mm. He noted he had detected perpends that failed to meet these requirements and insisted that all the areas would require reworking.
2. Mr Kosa accepted that there were "A few perpend joints to the to the brick are less than5mm wide" and he acknowledged that they were defective. However, he disputed that the brickwork had to come down. The brickwork was not showing any sign of stress or cracking and that the pool brickwork to rectify a few areas of defective joint would result in a greater issue in trying to match the brickwork and mortar colour. Taking into account the technical nature of the breach, the considerable cost of undertaking the rectification recommended by Mr Kerr which was to be $1,058, and the risk of creating further problems, I find that taking down and rebuilding the brickwork is not a reasonable course to adopt. However, Mr Koka will have to live with some variation in perpend width and that I will allow damages of $500 for loss of amenity in respect of this item.

1. The issue here identified by Mr Kerr was that there were some voids and numerous small holes in the mortar joints around the house and garage. He noted that under the Victorian Building Authority Guide to Standards and Tolerances 2015 ('VBA Guide to Standards and Tolerances'), these are defects if they are visible from the normal viewing position.
2. Mr Kosa accepted that there were some voids that were defects. The recommended method of recommendation was to have them filled and cleaned. Mr Kosa assess the cost of rectification at $276.85.
3. Mr Buchanan assessed the cost of rectification at $417 inclusive of preliminaries, margin and GST. I am prepared to make an award based on this assessment. For the reasons explained above, the relevant assessment is two thirds of $417 which I calculate to be $278. I will allow damages in this amount. I note this allowance is almost identical to Mr Kosa's assessment.

1. Mr Kerr observed that in numerous areas mortar stains were evident on the face of the bricks. This was a defect acknowledged in the VBA Guide to Standards and Tolerances, clause 3.07.
2. Mr Kosa acknowledge that the masonry walls "are not free from cement mortar over the face of the brickwork". However, he opined that the builder had not completed the work, and this was not a defect. Nonetheless, he assessed the cost of cleaning off the mortar smears at $326.10.
3. Although I accept that the builder had not completed the entire scope of work, I consider that the mortar smears should have been removed from the brickwork as soon as reasonably possible. In any event, the brickwork would have had to have been cleaned by the builder before the job was completed. Accordingly, Mr Koka is entitled to damages in respect of this issue.
4. Mr Koka sought damages based on the amount he has expended in carrying out rectification defects except Australian Standard ('AS'); where he expressly relied on Mr Buchanan's costings. Removing mortar smears from the brickwork was not one of the items for which Mr Koka sought to rely on Mr Buchanan. It follows that he must be taken to be seeking recovery of the sum of $3,200 inclusive of GST which he deposed in his witness statement that he paid for acid washing of the external walls together with demolishing and then rebuilding brickwork in the garage, in July 2019.[48] This invoice is almost 10 times higher than Mr Kosa's assessment of the cost of removing the mortar smears, and also compares unfavourably with Mr Buchanan's assessment, which was $1,231 inclusive of preliminaries, margin GST.
5. Mr Koka did not call the contractor who he deposed had cleaned the bricks, Zaya Ibrahim, to justify his price and to explain what portion of his total invoice should be allocated to clean the bricks.
6. In these circumstances I will assess damages based on Mr Buchanan's costing of $1,231 inclusive of loadings. This figure is to be reduced by one third, for the reasons explained above. Mr Buchanan assessed the cost of cleaning the bricks at $1,231 inclusive of preliminaries, margin and GST. This assessment is to be reduced by one third for the reasons explained above. The award will be $821 (rounded up from $820.67).

1. Mr Kerr identified that most of the articulation or control joints had non-compressive material including mortar still in the joints. This was a breach of Australian Standard ('AS') 4773.2.
2. Mr Kosa noted that when he inspected the dwelling in August 2019 all of the joints had been sealed. However, he could not verify that they had been cleaned before being sealed.
3. On the basis that the weight of the evidence supports Mr Koka, I will accept this defect. The rectification is to strip out the foam and mortar in the joints, and to refill the joints will with compressive material.
4. Mr Buchanan has assessed the cost of doing this work inclusive of preliminaries, margin, and GST at $529. I will reduce this assessment by one third, and will award $353, (rounded up from $352.67).

1. Not all external power points had been sealed at the top and sides of the connection to the brickwork. Mr Kerr opined that this constituted a defect as it was a breach of AAS 3000, clause 1.7.1. Mr Koka must have had the sealing of the GPO's performed, because the issue had been rectified by the time I conducted my site inspection. Although the work was done, Mr Koka referred to no invoice for the work in his final submissions.
2. The cost to rectify was assessed by Mr Buchanan at $139.
3. Mr Kosa allowed nothing. As Mr Kosa read the Kerr report, all that was required was the sealing of the conduit entry and the fixing points.
4. From my reading of the Kerr report, I am satisfied that the issue identified by Mr Kerr did exist. However, having regard to this difference of opinion between the experts, I cannot be satisfied that the issue amounted to a defect. This finding is not of great financial significance, because if I had found there was a defect, I would not have awarded $139. I consider that this is an excessive assessment of the cost to apply waterproofing silicon to the top and sides of the external power points. I would have awarded only a nominal amount for this work if I was satisfied there was a defect. As I am not so satisfied, I allow $Nil for this defect

1. Mr Kerr found that some weep poles contained excess mortar. This affected the functionality of the hole and was a defect under AS 4773.2-2010, clause 1.6.2.1.
2. Mr Kosa disputed there was a defect. He pointed out that no weep poles were blocked by mortar to the point that moisture could not leave the cavity.
3. I accept that it is appropriate for excess mortar to be cleaned. The issue of quantification remains. Mr Buchanan assessed the cost of rectification at $167 inclusive of preliminaries margin and GST. If this is reduced by a third, the cost becomes $111.33. I note that Mr Kosa indicated that this defect was allowed, the cost to rectify would be a $106.48. I will adopt a conservative approach and award damages based on Mr Buchanan's assessment. I will award a figure of $111, rounded to the nearest dollar.

12 Electrical outlet within 100mm of downpipe

1. Mr Kerr highlighted that AS 3500.3 mandated that downpipes cannot be installed within 100mm of an electrical cable. He identified a downpipe which breached this requirement and opined that either the electrical cable or the downpipe would have to be relocated. The required rectification was costed at $278.
2. Mr Kosa allowed nothing for this defect. He noted that no exposed cable was present within 100 mm of the downpipe, and the entry point for the relevant electrical cable was located more than 100 mm from the downpipe. As such, he considered that no defect was established. I accept Mr Kosa's opinion on this, and make no allowance for this defect

13 Black plastic DPC does not extend full width of brick

1. The defect identified by Mr Kerr was that the builder had used black plastic flashing as a DPC (damp-proof course). In breach of AS 4773.2 part 9.6.1, the flashing did not extend through the entire width of the masonry leaf and accordingly was not acceptable as a DPC. Mr Buchanan costed rectification at $2,569 inclusive of preliminaries, margin and GST.
2. Mr Kosa accepted the existence of this defect and agreed that a DPC had to be provided to the extent of the full width of the masonry leaf. He itemised the required rectification work as grinding out the mortar joints along the DPC line (4 hours @ $80 per hour or $320), injecting silicon-based DPC (8 hours @$80 per hour or $640) and added 10% for preliminaries, 15% for margin and 10% for GST. His total costing came to $1,277.76.
3. I note that if Mr Buchanan's costing of $2,559 is reduced by one third, the assessment becomes $1,712.67. This is still considerably in excess of Mr Kosa's assessment. Looking at the respective breakdowns of the work, I can see that the difference lies largely in the cost of grinding out the horizontal mortar bed. Mr Buchanan assessed this cost of $896, where Mr Kosa allowed $320. It is not appropriate for Mr Koka to have to bear the risk of an insufficient allowance to rectify a clear defect, and accordingly I will assess damages based on Mr Buchanan's assessment. The allowance for damages will be $1,713.

The internal corners documented have been constructed with unnecessary straight joins. The nominated bond for this dwelling is half bond and that is the method that should have been used throughout the brickwork, easily achieved by building in.[49]

1. Mr Kosa disputes that there is a defect, on the basis that "There is no documentation to state what bond the brickwork is to be at all."
2. Given that Mr Kerr did not identify where in the specification or the plans half bond brickwork was stipulated, I am not satisfied there was a defect. In any event, as there is no suggestion that the brickwork is structurally unstable, I consider that this is an issue which, if technically a defect, is of such a nature that toward damages for its rectification would be to deliver to Mr Koka what Oliver J in Radford v De Froberville described as "an uncovenated profit"[50]. The resulting windfall to Mr Koka would be substantial, as Mr Buchanan had assessed the costs of rectification at $3,751.
3. For these reasons, I allow nothing for this claim.

1. Mr Kerr observed that there were open concrete voids at the slab edge and that these were showing the exposed reinforcement bars. He opined that the steel had not been installed with the minimum concrete cover required by the Building Code of Australia ('BCA'), part 3.2.3.2.[51] The cost to rectify was assessed at $306.
2. Mr Kosa acknowledged that some reinforcement bars had been exposed when excess concrete from the pour had been removed but noted that as a concrete pavement would be poured around the dwelling, the area would be covered. On this basis the defect would ultimately be rectified. Nonetheless, he assessed the cost of rectification and $106.48.
3. On the basis that Mr Kosa accepted that some work needed to be done to fill the voids, I will allow damages. To be conservative, I will assess damages on the basis of Mr Buchanan's assessment of $306, reduced by one third. The allowance will be $204.

1. The issue identified by Mr Kerr was that in places the brick work overhung the edge of the slab. In some places, the overhang exceeded the maximum allowed by the BCA, Part 3.2.2.7 of 15 mm. The cost to rectify was identified by Mr Buchanan at $223.
2. Mr Kosa disputed the existence of the defect, noting that a small corner of one brick was overhanging the slab rebate, and this represented less than 5% of the brick. He contended that "5% of the brick is not a masonry wall"[52]. In support of his argument he cited the VBA Guide to Standards and Tolerances, at [3.16] which provides:

A masonry course is defective if it is laid on a concrete slab or strip footing so as to project over the edge of the slab or footing by more than 15mm.

1. The VBA Guide to Standards and Tolerances is a guide and is not strictly binding on the Tribunal, However, there is logic in Mr Kosa's opinion regarding its interpretation of BCA, Part 3.2.2.7. Moreover, I made a note at the hearing that Mr Chidhambaram, when giving evidence, supported Mr Kosa's view.
2. I allow nothing for this defect

1. Mr Kerr consider that a small number of bricks had been chipped in excess of a reasonable level. He suggested that this constituted work which had not been carried out with reasonable care and skill, in breach of the warranty implied by s 8 (d) of the DBC Act.
2. Mr Kosa agreed that a small number of bricks had chipped edges, but opined that it would be unreasonable to remove the bricks and then repair the brick walls.
3. I agree that removal of the chipped bricks would not be both necessary and a reasonable course to adopt. I accordingly allow no damages for this defect on the basis of the exception to the rule of damages for breach of a building contract established by Bellgrove. However, because Mr Koka will have to continue to live in a house with chipped bricks, I will allow damages of $500 for loss of amenity in respect of this item.

18 Colorbond downpipes, fascia and gutters damaged

1. Mr Kerr observed that the colourbond downpipes, fascia and gutters installed on the house had been damaged during construction. Some presented as scratched or marked with builder's waste. On the basis that the supplier's website stated touchup paint was not to be used in rectify this type of defect, the process of rectification involved replacement of the damaged items. Mr Buchanan costed rectification at $9,330.
2. Mr Kosa's response was that the photos contained in Mr Kerr's report had been taken close up. My review of the photos indicates that this is clearly correct.
3. Mr Kosa went on to say that when viewed from the "normal viewing position" there were no obvious marks on the downpipes, fascias or gutters.
4. Mr Kosa did not define what he meant by "normal viewing position" but there is little doubt that he was referring to the normal viewing position as described in the VBA Guide to Standards and Tolerances. It provides, in [F] of its Introduction, as follows:

Generally, variations in the surface colour, texture and finish of walls, ceilings, floors and roofs, and variations in glass and similar transparent materials are to be viewed were possible from a normal viewing position. A normal viewing position is looking at a distance of 1.5m or greater (600mm for appliances and fixtures) with the surface or material being illuminated by 'normal-critical light'. Non-critical light means the light that strikes the surface is diffused and is not glancing or parallel to that surface.

1. Mr Kosa allowed $1,703.68. He explained at the damages hearing that it was apparent at the defect hearing that "no one could pinpoint exactly where the damage was, how bad the damage was or if the damage actually did exist." For this reason he had allowed for rectification of a small area of downpipes and fascia.
2. I accept Mr Kosa's criticism of the evidence given on behalf of Mr Koka. I will allow damages rounded to $1,700 in respect of this item.

1. This is the first of a number of individual claims made by Mr Koka about the roof tiles based on his experts' reports.
2. Mr Camilleri expressed the view at several points in his report of 2 July 2021 that "due to the various extended defects to the roof tiles, my high recommendation would be to dismantle the exterior roof tiles, to then adjust the truss roof and timber batteons (sic) and to then re-install new roof tiles" .[53] Mr Camilleri confirmed this view at the hearing.[54] Mr Koka pressed for an award of damages based on removal and replacement of all the roof tiles in his final submissions.[55]
3. I find below, at [309], that wholesale replacement of the roof is not appropriate. Accordingly, it is necessary to assess the cost of rectification of the individual roof tile defects.

1. Mr Kerr noted a number of roof tiles were sitting proud above other files because flashings or other materials had been left underneath. Tiles are required to be aligned pursuant to AS 2050, Part 3.3.1.
2. Mr Sherwood inspected the property on behalf of Mr Koka on 21 June 2019. He noted that this item had not been addressed as at the date of his inspection.[56]
3. Mr Sherwood inspected the property again on 3 July 2019. He again observed that this issue with the tiles had not been rectified.
4. Mr Kosa noted at his inspection on 13 August 2019 that the tiles generally were laid flat. He noted that he had been advised by the builder that the tiles had been adjusted by the roof tiler.
5. However, Mr Kosa was not the last expert to inspect the roof. Mr Camilleri inspected the property on 2 July 2021 on behalf of Mr Koka. In his report[57] Mr Camilleri identified, at [1.11], that many roof tiles were still sitting proud of other tiles. On this basis, I am satisfied that the defect remained.
6. Although he disputed there was a defect, Mr Kosa costed rectification at $212.96.
7. Mr Buchanan assessed rectification at $480 inclusive of preliminaries, margin and GST. I am prepared to allow damages to Mr Koka based on this assessment. Mr Buchanan's assessment of $480 is to be reduced by one third, with the result that I will award $320 to Mr Koka.

1. Although this defect was identified by Mr Kerr, it was not pressed by Mr Koka in his final submissions. No more need be said about it**.**

1. Mr Kerr noted that under AS 2050 3.6, the cutting of tiles is to be straight and neat. The valley tiles had not been cut straight, and hence there was a defect. Mr Kosa disagreed on a factual basis. He recalled that he had viewed the valleys and had found they were uniformly set straight. No defect was noted.
2. Mr Sherwood recorded in his third report of December 2019 that when he inspected the tiles on 3 July 2019 this defect had not been rectified. However, the date of Mr Kosa's inspection-13 August 2019-was more than a month later than Mr Sherwood's inspection.
3. However, Mr Camilleri on 2 July 2021 found that the defect remained. Mr Chidhanbaram also identified this defect in his report of 21 June 2021.[58] Accordingly, I am satisfied that the defect exists.
4. Although Mr Kosa disputed there was a defect, he assessed the cost of rectification at $212.96, based on two hours work by a roofing contractor.
5. Mr Buchanan assessed the cost of rectification at $2,143. I will award damages based on this assessment as I regard it to be much more realistic than Mr Kosa's. Two thirds of this assessment is $1,428.67 which I will round up to $1,429. I will award this sum.

22 Flashings, infill panels at window heads, cladding over porch not done

1. Mr Kerr found that the dwelling was not watertight because the flashings, infill panels over windows and cladding over the porch had not been installed.
2. Mr Kosa recorded at his inspection on 3 August 2019 that the infill panels and sill flashings were installed and that all cladding seemed to be in place. He noted that there had been reasonable rainfall the day before he inspected and that no evidence of water entry anywhere was apparent. He opined there was no defect.
3. Mr Camilleri inspected the dwelling on behalf of Mr Koka in July 2021. He made no comment about this issue.
4. I accept Mr Kosa's evidence, and allow nothing for this defect.

1. Mr Kerr observed that there had been damage to the fascia. He suggested that this might have been caused by cleaning using acid, but noted that this was mere speculation**.**
2. This defect has been dealt with above, as part of defect 18. No further comment is required.

1. Mr Kerr observed at his inspection on 1 May 2019 that some roof tiles were damaged and chipped. Mr Kosa could not identify any chipped roof tiles. He noted that the builder had advised that "the roof tiler" had attended and repaired sections of the roof. Mr Kasho made no reference to sending his roof tiler back to the dwelling to carry out rectification work. Accordingly, I infer that the roof tiler had been engaged by Mr Koka. This is consistent with his evidence in his witness statement, at [60], where Mr Koka deposed that he engaged a contractor named The Roof King to attend in August 2019 to replace broken tiles and some other issues.
2. Because Mr Kerr opined that there had been damaged and chipped roof tiles, and because Mr Kosa found that they had been repaired, I accept on balance that Mr Koka did have the tiles repaired. For this reason, I allow damages to Mr Koka in the sum he paid to The Roof King of $2,100.

25 Boundary garage wall provides insufficient fire protection

1. Mr Kerr opined that the upper boundary garage wall would have to be reworked to include fire protection.
2. Mr Koka deposed in his witness statement, at [57], that after termination he engaged a bricklayer named Zaya Ibrahim to rectify some defects. The work involved demolition of the upper part of the garage wall and relaying the bricks, but also acid washing excess water of the external walls. Mr Ibrahim invoiced a total of $3,200 inclusive of GST on 30 July 2019.
3. I have allowed recovery of damages to Mr Koka in respect of the cleaning of mortar of the brickwork close to Mr Buchanan's cost (inclusive of preliminaries and margin and GST) of $1,231. Because Mr Ibrahim's invoice for $3,200 expressly included GST and impliedly would have included loadings for preliminaries and margin, I infer that the portion of Ibrahim's invoice that related to demolishing and relaying the upper part of the brickwork in the garage was $2,000.
4. I will allow recovery of $2,000 to Mr Koka for this item.

1. Mr Kerr noted that the metal transfer flashings around the dwelling were falling back towards the wall frames, and identified this as a defect under AS 3500.3. He opined that the flashing must be reworked to prevent premature corrosion. The existence of the defect was confirmed by Mr Camilleri in his report, at [1.14] [59] following his inspection of 2 July 2021.
2. Mr Buchanan costed the work of taking down the gutters, fascias and flashings at the garage boundary wall and reinstalling new items at $1,086 inclusive of preliminaries, margins and GST.
3. Mr Kosa disputed there was a defect, and commented that even it was accepted, it could be rectified by firmly securing the flashing to eliminate flex. His assessment of the cost of rectification was $106.48.
4. I consider that Mr Kosa's responses do not meet the gravamen of the allegation. I accept Mr Buchanan's primary assessment of damages of $1,086. For the reasons explained, this assessment is to be reduced by one third. I will award Mr Koka $724 for this item.

1. Mr Kerr noted that all of the perimeter window and door architraves needed to be capped to the plaster to meet the energy rating required by the code. The sealing of windows was also called for by AS 2047.
2. Mr Kosa disputed there was a defect, arguing that sealing by the use of an architrave was sufficient, and that the architrave itself did not need to be caulked. Nonetheless, he assessed damages rectification at $336.74, based on three hours work.
3. Mr Camilleri in his report, at [1.15], confirmed existence of the issue in July 2021. He emphasised that the purpose of sealing the windows was to restrict air infiltration.
4. I prefer the view of Mr Kerr and Mr Camilleri, and find there is a defect. Mr Buchanan costed rectification at $599 inclusive of loadings and GST. Mr Kosa suggested a figure of $336.74 inclusive of preliminaries, margin and GST, based on an allowance of three hours work. I do not regard Mr Buchanan's costing as unreasonable and will allow two thirds of his assessment to Mr Koka in respect of this defect. The damages allowed are accordingly $400.

1. Mr Koka's evidence was that after the termination of the contract the kitchen and bathroom cabinets were not complete as some did not have doors and none of the doors had door handles.[60] He deposed that he engaged JJ Cabinet Design to complete the cabinets. It took two employees two days to complete them and to cut the cabinets in around the range hood. He said he paid an invoice of $4,400 to the cabinet maker.
2. Mr Kerr inspected the dwelling in May 2019 and observed that all cabinet door and drawers that needed to be reworked should be realigned.
3. Mr Kasho addressed the cabinets in his witness statement, at [98]. He said that when he left the site all the kitchen cabinet doors had been installed. He did not dispute that the door handles had not been installed, but he blames Mr Koka for this, saying that he prevented the installer from putting them in. Mr Kasho's key point is that he queries how replacing 4 cabinet doors and installing the handles could cost $4,400. I regard this as a very fair question.
4. I make no allowance for the cabinetmaker's invoice that was allegedly rendered to Mr Koka, as I regard it as inherently unreasonable. Furthermore, it is incompatible with Mr Koka's expert's evidence. In this connection, I note that Mr Buchanan assessed the cost of rectification at $853 inclusive of preliminaries, margin and GST, based on one day's work by a cabinet maker.
5. Mr Kosa assessed the cost of $425.92 inclusive of preliminaries, margin and GST, as he allowed for only half a day's work. On this occasion, I prefer the evidence of Mr Kosa, because Mr Kerr implied that some of the doors and drawers were acceptable and only some of them required adjustment. I will award $426 to Mr Koka in respect of adjustment of the cabinet doors.

1. Mr Kerr observed that the shower wastes contained builder's waste which required removal to comply with AS 3500.2, Part 4.3.1(g). Mr Buchanan opined that it would be necessary for a plumber to do this work and assessed the cost at $139.
2. Mr Kosa rejected the allegation that there was a defect on the basis that the house had not been handed over. I accept this point but note that builder's waste everywhere would have to be removed in the builder's final clean before handover. The shower waste would have had to be cleaned at this time, at the latest. I accept Mr Buchanan's view that waste inside the drain would have to be removed by a plumber. I will allow two thirds of Mr Buchanan's assessment of $139, or $93, for cleaning of the shower wastes.

1. Mr Kerr observed that there were a number of areas in the house where walls were out of alignment in excess of the allowed tolerance of 4mm over 2m.
2. In response, Mr Kosa noted that the Kerr report did not state where and how much the walls were out of tolerance. His own investigations could not identify any wall that exceeded the maximum tolerance, and he found there was no defect.
3. I consider that Mr Kosa's criticism of Mr Kerr's report is unfair, because he included at least 10 photographs showing areas of the house where he said plaster was out of alignment.
4. Mr Koka gave evidence that he had spent $5,115 in having plasterwork redone. That this occurred was robustly contested by the builder, on the basis that Mr Kasho gave evidence that the plasterwork remained unchanged. Mr Koka did not strengthen his case by calling the plasterer, but I draw no inference from this. I simply note that it is regrettable that a relevant witness was not called.
5. Mr Camilleri inspected the dwelling in July 2021. In his subsequent report, he acknowledged, on the basis of instructions received from Mr Koka, that repairs to some areas of the defective walls had occurred. However, he was able to identify several areas which were still non-compliant. Mr Camilleri included photographs in his report, and they demonstrated that these areas were different to those identified by Mr Kerr. I conclude from this that Mr Koka did have work performed on the plaster walls.
6. Mr Buchanan costed the rectification of plasterwork at $4,175 inclusive of preliminaries, margin and GST. A difficulty with accepting this figure is that Mr Buchanan costed the replacement of an unspecified area of plasterwork throughout the house. At the damages hearing on 23 October 2023, Mr Buchanan indicated that he allowed "for a squad maybe three men for a day, day and a half, just to go through and straighten and getting the finishes lined up".[61]
7. I am not prepared to accept Mr Buchanan's costing for two reasons. First, it was based on an assumption about the scope of work required, and was not reflective of any particular scope of work identified by any one of Mr Koka's consultants. Second, it was clear from Mr Camilleri's evidence that Mr Koka did have the plasterwork attended to.
8. Mr Koka put into evidence an invoice received from his plasterer in the sum of $5,115. I will allow to Mr Koka recovery of damages in respect of this invoice. The award is $5,115.
9. I infer that Mr Koka regarded the other areas of defective plasterwork identified by Mr Camilleri as either trivial or so unimportant as to be not worth rectifying. If Mr Koka thought they were worth rectifying, he presumably would have had the work done when his plasterer was on site. I will allow nothing in respect of rectification of these other areas.

1. Mr Kerr observed that the bath had been used as an on-site rubbish bin during construction and would need to be cleaned and any scratches or indentations removed. They claim was not pressed by Mr Koka in his final submissions, and it is not necessary to discuss this item further.

1. Mr Kerr referred to AS 3958.1, which requires tiles to be cut smoothly and with an even width. It is to be inferred that he regarded some tiles at least as falling short of the standard. However, no details were given by him.
2. Mr Koka's evidence about the tiling is contained in his witness statement, from [62]. He alleges that the builder engaged an inexperienced tiler. After the tiler had completed about 80% of the tiling, Mr Koka inspected the work and was unhappy with the result. He contacted Mr Kasho who inspected the work also. Mr Kasho refused to pay the tiler, which caused the tiler to press Mr Koka for payment.
3. Mr Koka ultimately paid Ben's Tiling $12,507 for his work. He also paid invoices for materials of $67.68 and $437.18. The total claim accordingly made by Mr Koka is $13,011.86.
4. Mr Kasho addressed the tiling issue in his witness statement at [38(h)]. He raised three issues. The first is that Mr Koka chose tiles measuring 1200 mm x 600 mm which were larger, more expensive and more expensive to lay than the than the specified 600mm x 600mm tiles. The second is that after the tiler finished laying the floor tiling at the end of 29 January 2019, Mr Koka and his family went inside the house and disturbed the tiles. The third is that about the middle of February 2019 Mr Koka asked to have other areas of the house tiled but Mr Kasho refused. At this point Mr Koka told the tiler to stop doing work.
5. There is a fundamental conflict between the evidence of the two sides. In the absence of any expert evidence supporting Mr Koka's view that the tiling performed by the builder's tiler was unsatisfactory, there is no basis for me to make a finding that the builder is to pay damages for defective tiling. This claim is dismissed.

1. Mr Kerr identified a defect in that some of the bottom window reveals are too wide and were presenting with a fallback towards the window. He suggested that the windows were not properly supported. Reference was made to AS 2047-2014 generally.
2. Mr Kosa rejected Mr Kerr's opinion. He opined that the window reveals were secured in place with architraves. As the windows were operational and there was no cracking or movement to the reveals, no defect was identified.
3. Mr Camilleri, [1.22] of his report, expressed an opinion supporting Mr Kerr's observation that the window reveals fell back towards the window.
4. The cost of removal and rectification of the windowsills was costed by Mr Buchanan at $2,047, inclusive of preliminaries, margin and GST.
5. Mr Kosa disputes that there is any defect, but I consider that just because the windows are currently operational and there is no movement in the reveals does not mean that they have been properly fixed. The issues noted by Mr Kerr may be indicative of a range of issues. I am satisfied that Mr Koka is entitled to an award in respect of this item. I will allow damages equivalent to two thirds of Mr Buchanan's costing of $2,047, namely $1,365 (rounded up).

1. Mr Kerr observed that the insulation had not been completed in May 2019. Mr Kosa acknowledged the situation. However, in his final submissions, Mr Koka conceded that the issue had been rectified and that the amount of $300 had been refunded to him by the subcontractor. No more need be said about this item.

1. Mr Kerr noted that the approved plans call for a step down between the dwelling and the garage of 86mm. This had the potential to be a big issue, as Mr Buchanan had costed all the necessary rectification work as totalling $11,285.
2. However, I have determined above, at [60], that Mr Koka is the party who must bear the responsibility for the fact that the level of the garage relative to the house does not conform to the approved plans. There will be no award in respect of this item.

1. Mr Kerr advised that because of the additional site cut, engineering design for associated reworking of the waterproofing and drainage design for the garage boundary wall would be required.
2. Mr Kosa disputed that the weep holes in the garage boundary wall were below the adjoining retaining wall and considered that they allow for sufficient ventilation and drainage. As no moisture or water damage was evident in the garage, no defect was accepted by Mr Kosa. I accept Mr Kosa view, and this disposes of the issue of the weep holes on a factual basis.
3. I add that even if the weep holes had been compromised by the additional site cut, this would have been a matter for which Mr Koka had to take responsibility in any event. This is because of my finding that he is the party who must bear the responsibility for the issues flowing from the site cut.
4. I now turn to the question of the need for a retaining wall generally.
5. In Mr Koka's witness statement, at [153]-[155], he deposed about the need to construct a wall around the boarder of the property as result of the site cut.[62] On the basis of invoices received from DYS, he claimed damages of $9,658 for this work
6. As I have found that Mr Koka is responsible for the problems arising from the site cut, I allow no damages to him in respect of this item.
7. Mr Buchanan assessed the cost of reconstructing the retaining wall at $26,202. The justification for the work was that the retaining wall had been constructed on the neighbour's property and Mr Camilleri had expressed the view in his report of July 2021 that this is not compliant with the requirements of the Council. No allowance is made for this head of damages, as it was Mr Koka who constructed the retaining wall.

1. Mr Kerr established by reference to the approved plans that the builder had constructed a number of elements of the house other than in accordance with the plans. In his final submissions, Mr Koka pursued recovery in respect of only two issues, namely the corner window in the bedroom, and the pantry doors.
2. Mr Kerr observed that the window in the bedroom had not been installed correctly.
3. Mr Kosa acknowledged that the window installer did not comply with the approved plans, which called for a corner mullion or wraparound window. Mr Kosa noted that the builder advised that the structure did not allow for the construction of a wraparound window. No detail had been provided in the architectural drawings as to how the head and ceiling soffit would be supported. Accordingly, there must be some doubt that the approved drawings could not be executed by the builder.
4. Mr Kosa, however, did not rest his opinion on this basis. Instead, he opined that as the window constructed did not look out of place, no defect was noted.
5. I accept that technically there is a defect, because the window as built does not comply with the approved plans. However, I am not prepared to make an award of damages in circumstances where it seems the owners design could not be put into effect.
6. Moreover, I find that the window is functional and aesthetically acceptable. The cost to rectify the defect was assessed by Mr Buchanan at $8,662 and accordingly I consider there would be a complete lack of proportionality between the cost of rectification of the defect and the nature of the defect. Lack of proportionality in such circumstances is a factor which militates against an award of damages. See Stone, referred to above at [114].

1. Mr Kosa acknowledges in his report that the cavity sliding door in the pantry had not been constructed. The approved plans called for the installation of a 820 mm cavity slider but Mr Kosa advised that a door of this dimension would not fit once a nib had been provided on the lock side of the door. This observation is consistent with Mr Koka's evidence[63], which is that after a doorframe of insufficient size had been built, he insisted that a door of 820 mm be created so that a refrigerator could be placed in the pantry. The builder created a wider opening as required, but refused to install a sliding door of 820 mm.
2. As the plans provided by the owner could not be put into effect, the owner can have no complaint, as the contract required the builder to construct only, not to design and construct. I comment that the deletion of the 820 mm door should have been properly documented, and a credit should have been assessed in favour of the owner. However, Mr Koka did not seek a credit but insisted on recovering damages in respect of the cost of constructing the cavity as documented. This was assessed by Mr Buchanan at $8,137. I dismiss this claim.
3. Even if I have been satisfied that the builder had responsibility for the non-compliance of the pantry door with the approved plans, I would not have awarded $8,137 in any event on the basis that there is a great disproportion between the cost to rectify and the practical importance of the issue.

1. The claim in relation to a power point not being placed in the bathroom as required by the approved plans was not pressed in Mr Koka's final submissions. This item falls away.

1. The issue with the master bedroom doors is that they have been created as a mirror-image of how they were documented. The doors were designed as a pair constituted by one door and a half door. On the approved plan, looking into the bedroom, the small door was to sit on the left-hand side ('LHS') and the large door on the right-hand side ('RHS'). They have been constructed in the opposite configuration. However, Mr Kosa has confirmed that the doors are functional, and the change of configuration does not affect access or usability, so no re-working is justified. I accept Mr Kosa's opinion, and reject this defect as to do otherwise would be to allow the recovery of damages for a technicality.

1. Mr Koka seeks damages on the basis that the flue for the gas fireplace has been placed other than as mandated in the approved plans. Mr Kasho disputes this claim. The approved plans called for a gas fireplace, but no details were given as to its size or the placement of the flue. According to Mr Kasho's witness statement, the fireplace was ordered by Mr Koka after the contract was signed.[65] When it came time to install the fireplace flue, the roof trusses had been installed and it was not possible to exit the flue through the roof because of the placement of the roof trusses. For this reason, the fireplace flue was exited from the house through the wall.
2. I consider it clear that this variation from the plan arose from Mr Koka's failure to make a decision about the fireplace in a timely manner. No damages are allowed in respect of this item.

1. Mr Kerr correctly identified that a bathroom sink had been placed other than in accordance with the approved plan. This issue has been discussed above, and I have found that Mr Koka is responsible for the problem. No damages will be allowed in respect of this issue.

DEFECTS IDENTIFIED BY MR SHERWOOD OR MR CAMILLERI

1. The above defects were identified by Mr Kerr. The remaining claims made by Mr Koka for defects are based on either Mr Sherwood or Mr Camilleri's opinions.

1. Mr Camilleri's inspection in July 2021 confirmed the existence of damage to the valley irons which had been identified by Mr Sherwood in his third report of December 2019.[66]
2. Mr Kosa opined there was no defect, because the issue related to a small gouge of approximately 25 mm wall in one (valley.) As this is not critical to the longevity of the valley iron, no rectification work was warranted.
3. Mr Sherwood in his third report identified "hits" to the front valley iron during installation, possibly from a grinder.[67] His language suggests there was more than one area of damage and that the issue was accordingly more serious than Mr Kosa thought.
4. Mr Sherwood was adamant that the whole of the valley iron had to be replaced. As Mr Camilleri also confirmed the existence of this defect, the way the expert evidence is with Mr Koka. I will award damages in respect of this issue.
5. Mr Buchanan costed this work at $3,636. However, this figure was arrived at on the basis of all valley gutters would be replaced. This was consistent with Mr Camilleri's recommendation, but it is in conflict with Mr Sherwood's observation that only the front gutter was affected. Doing the best I can on the limited evidence available, I will assess damages on the basis of 50% of Mr Buchanan's costing, namely $1,818. From this figure the loadings for preliminaries and margin must be stripped out. The resulting award will be $1,212.

1. The complaint here was that some tiles at the front LHS of the house overhung the gutters preventing discharge to the downpipe. This was a breach of AS3500.5, section 5 .5 4.7.3.
2. Mr Kosa acknowledges that it was established that the tiles extended by more than 55mm over the gutter.

osted rectification at $3,518. I will award damages based on this assessment. After the loadings for preliminaries and margin are removed, the resulting figure is $2,345.33, which I will round down to $2,345.

1. A separate issue with the gutters, identified by Mr Sherwood in his December 2019 report, was that the gutters at the front LHS of the house held some water. However, he provided no photographs of the problem. Mr Kosa disputed that the gutters at the front of the house were holding water.
2. Mr Camilleri had an opportunity to confirm the defect when be inspected the house in July 2021 but did not do so. He repeated Mr Sherwood's comments, but recorded no personal observations.
3. I find that this this defect is not established.

1. Mr Sherwood, in his third report of December 2019, observed that the trusses presented with dips and troughs on the RHS elevation. He noted that the acceptable allowance was 20mm and he considered that the dips and troughs exceeded this allowance. His recommendation was that the builder needed to ensure that the trusses installed were acceptable by a certification from supplier.
2. Mr Camilleri did not record any independent observations in July 2021, but due to what he considered were various and extensive defects in the roof tiles, he recommended removal of the roof tiles, strengthening of the roof frame and timber battens and reinstatement of the tiles.
3. Mr Buchanan costed rectification of the roof at $29,014.
4. Mr Kosa observed that the RHS of the house was the side where the garage stood. He noted no internal roof undulation on the garage roof and considered there was no defect.
5. At the site inspection I observed no undulation of the roof of the RHS either. I accordingly dismiss the claim for damages for complete dismantling and reassembling of the entire roof.
6. Mr Kosa did concede that some areas of the roof required attention. He had allowed for rectification of a couple of areas, which involved removing the tiles and adjusting the battens before relaying the roof tiles. His allowance was $1,251.14. I will round this figure to $1,250, and award this sum in damages to Mr Koka in respect of the adjustment of the roof tiles.

1. Mr Sherwood, in his December 2014 report, observed that the face brickwork around the dwelling showed inconsistent mortar colour. He opined that this was a defect. These comments were made despite Mr Kosa's observation in August 2019 that the bricklayer had been in the process of rectifying some of the inconsistencies in colour. However, Mr Kosa agreed that rectification of colour variances in the mortar should be carried out. His costing was $299.48. At the damages hearing, he explained that he was allowing for painting over the joints with a product called Nawkaw, rather than grinding out and replacing the mortar joints.
2. Mr Camilleri's report confirmed that in his view that the brickwork overall had many unappealing defects.[68]
3. Mr Buchanan costed the rectification of the inconsistent mortar colour at **$**5,811. This figure was derived by allowing for grinding out the mortar joints and repointing the joints with colour matching mortar.
4. Neither Mr Sherwood nor Mr Camilleri expressly stated the grinding out the mortar and replace it was the appropriate method of rectification.
5. I will allow damages based on Mr Kosa's alternative recommendation of achieving consistency of watercolour by applying Nawkaw. I will round the cost he identified of $299.48 up to $300 and award the sum to Mr Koka.

1. Mr Sherwood opined that when the property was backfilled, the finished soil height would be higher than the required 150 mm below the DPC and weep holes.
2. Mr Kosa disputed that there was a defect. He observed that when he inspected the property in August 2019 the specified paving around the perimeter of the dwelling had not been installed.
3. Mr Camilleri inspected the property in July 2021 and made no comment about this particular issue, although he was critical of the use of black plastic flashing as a DPC given the DPC did not extend to the entire width of the masonry.
4. I dismiss this claim as the ultimate height of the DPC with respect to the FGL (finished ground level) had not been established when Mr Kerr inspected the site. When Mr Camilleri inspected the site in July 2021, he did not note a defect

1. Mr Sherwood observed that under AS 5601, clause 4.10.2 and clause 4.11.4, all yellow gas pipes must be protected from UV radiation.
2. Mr Kosa did not dispute this comment, but he disputed there was a defect because the perimeter paving had not been installed at the time of his inspection in August 2019.
3. Mr Camilleri confirmed in his July 2021 report that no action had been taken regarding Mr Sherwood's observation. I accordingly find that this defect is established. Mr Buchanan's costing was $132, and I will make an award of damages based on this figure. After the removal of loadings for preliminaries and margin, the resulting award is $88.

1. Mr Sherwood opined that all PVC pipes must be painted in a UV rated paint colour that matches the dwelling. He pointed out that AS 1254 was called up in the NCC.
2. Mr Kosa agreed that stormwater risers are required to be painted, and I find that this defect is established.
3. Mr Buchanan assessed the cost of rectification of this defect at $225. I will make an award of damages based on this assessment. After the removal of the loadings for preliminaries and margin, the award will be $150.

1. Mr Sherwood identified a separate issue with the stormwater system, namely that by reference to the concrete slab rebate and the height of the DPC, the system would ultimately be installed without the required coverage. He referred to the relevant standards as set out in the NCC, part 3.1.2.5.
2. It was clear that at the time of Mr Sherwood's inspection, 3 July 2019, the pipes had not been covered. Mr Kosa confirmed that the time of his inspection in August 2019 the pavement around the house had still not been laid. He disputed that there was a defect concerning the coverage of the stormwater system.
3. I made a note that Mr Sherwood agreed at the hearing that there would be no defect if the pipes were covered by concrete. I noted that Mr Chidhambaram also agreed.
4. Mr Camilleri inspected the property in July 2021 but did not appear to refer to this alleged defect.
5. As the weight of expert evidence is strongly in favour of the builder, I dismiss the claim.

1. Mr Sherwood recorded that many of the doors throughout the dwelling were presenting as rough to touch along the door edge and arris. He opined that this meant that the work had not been completed in a proper and workmanlike manner in breach of the warranty implied by s 8(a) of the DBC Act, and that the edges would have to be sanded down and repainted to achieve an acceptable finish.
2. Mr Kosa disputed the existence of this defect. He noted that the doors were of standard manufacture. They had been fully painted and no rough edges were felt by him.
3. Mr Camilleri did not mention this item in his report following his July 2021 inspection.
4. I am not satisfied that this defect is established and make no award in relation to it.

1. Mr Sherwood observed that a number of door margins would need to be reworked to comply "with clause 8.04". Clearly he was referring here to the VBA Guide to Standards and Tolerances.
2. Mr Kosa opined that at his inspection the door margins were relatively even. In any event, he opined that any issue with the margins could be fixed after handover as a maintenance item. Accordingly, he did not consider this to be a defect.
3. On the basis that this work would have had to have been performed in due course as a completion item, I find that Mr Koka is entitled to damages in respect of it. Mr Buchanan assessed the cost of rectification at $276. Stripping out the loadings for preliminaries and margin, the resulting award will be $184.

1. Mr Sherwood identified unacceptable lips between polished porcelain tiles. Under AS 3958.1, the lips must be limited to 1 mm. An unspecified number of tiles were identified as exceeding this allowance.
2. Mr Kosa quibbled as to whether Mr Sherwood was referring to the relevant part of AS 3958.1. His substantive observation was that no tiles with lips of greater than 1 mm had been observed. I could not identify any comment by Mr Camilleri on the topic, and none was referred to in Mr Koka's final submissions.
3. I dismiss this claim on the basis that the defect has not been established.
4. I note that, in any event, it was established above, in respect of defect [261], that there was conflicting evidence about which party was responsible for the completion of the tiling

1. Mr Sherwood highlighted that all showers installed without a hob or stepdown must be completed with a vertical water stop that finishes a minimum of 5 mm above the finished floor level. He referred to AS 3740 part 3.13.4.
2. Mr Camilleri confirmed that the ensuite and bathroom do not currently meet this requirement. The only method of repair was to take the tiles out and install the required stop, including new waterproofing.
3. Mr Koka's fourth building expert, Mr Chisbambaram, did not note a defect in his report. At the hearing, he said he was unable to comment.
4. Mr Kosa confirmed that no water stop could be observed but noted that shower screens had been installed. No defect was accepted.
5. I note that this opinion conflicts directly with an opinion expressed by Mr Sherwood in his report to the effect that plastic guides placed under cavity sliding doors are not water stops as they are subject to movement and should be removable for maintenance.[69]
6. Mr Buchanan assessed damages at $20,697. This substantial figure is accounted for by the fact that he allowed for a scope of work based on Mr Camilleri's recommendation that the only repair method is to take out the tiles, apply new waterproofing, install stop, and relay the tiles. This process involves removing sanitary fixtures and fittings and cabinets and replacing them after the retiling.
7. However, in his final submissions, Mr Koka did not press for these damages but limited the claim to re-waterproofing.
8. In the circumstances, it appears that Mr Koka accepts the because the showers are enclosed by shower screens there is no defect. I dismiss this claim.

1. The defect identified here by Mr Sherwood was that the doorway to the ensuite WC not been set up with lift off hinges. This contravened BCA section 3.8.3.3.
2. Mr Kosa disputed there was a defect, because of the dimensions of the WC. An explanatory memorandum contained within the code explains that the clause is concerned with allowing removal of an unconscious occupant from an enclosed sanitary compartment. If the compartment is large enough to allow access, it is not considered enclosed for the purposes of the clause.
3. I accept Mr Kosa's opinion on this issue, and find there is no defect.

1. Mr Sherwood noted that AS 3958.1 calls chipped tiles to be omitted at cuts and finished work is to be free of scratches, chips, cracks and pits. He opined that a number of tiles presented as damaged. Although Mr Sherwood had marked some tiles as damaged and photographed them, Mr Kosa could not identify any damaged tiles. However, Mr Kosa acknowledged at Mr Koka's representative (at his site inspection) stated that the tiles had been replaced.
2. As remarked above, there was conflicting evidence about which party is responsible for the tiles. Mr Kasho's evidence include statements that Mr Koka interfered and prevented the builder's tiler from completing his work. Mr Koka's evidence is that he engaged Ben Tiling to perform work for which he paid in excess of $12,000.
3. Liability of the builder for the present condition of the tiling is not established. No award will be made.

1. Another defect with the tiles identified by Mr Sherwood was that there was no allowance for movement joints. Reliance was placed on AS 3958.1, section 5.4.5.1 and section 5.4.5.2(b).
2. Mr Kosa acknowledge that this defect existed, and agreed that movement joints should be installed.
3. Mr Sherwood opined that the method of rectification was to remove several grout lines and replace them with flexible silicon of appropriate colouring. Mr Buchanan costed rectification at $816. If I was satisfied that the builder was responsible for the missing movement joints, I would have been prepared to make an award based on Mr Buchanan's assessment.
4. However, as with defect 52, I cannot be satisfied that the builder is responsible for the current state of the tiling. No award will be made for this item.

1. Mr Sherwood criticised the use of plastic guides under cavity sliding doors in a bathroom, but did not specify where this occurred.
2. Mr Koka did not press for damages in respect of this item separately in his final submissions. The claim falls away.

1. The defect alleged here was that the garage door had not been installed with the required minimum of three fixings. Mr Koka accepted that there was a defect. Mr Buchanan costed rectification at $348 inclusive of preliminaries, margin and GST. I will make an allowance for damages based on this assessment. When one third of the amount is deducted to account for preliminaries and builder's margin, the resulting award will be $232.

1. There are two issues with the windows. The first is that Mr Koka wanted some sliding windows, in place of the originally planned awning windows but did not receive them. The second is that the windows in the completed house were marked with mortar and other material.

1. Mr Koka's evidence about the windows is to be found in his witness statement from [31]. He acknowledges that the approved plans allowed for awning windows for the whole house. However, he deposed that he wanted sliding windows because his wife advised that they were easier to clean and his mother said that they were easier to open and had better airflow. He went on to depose that he discussed this change with Mr Kasho on 27 September 2018, being the day that the contract and the specification (in the form of the Lists of Inclusions) were signed. Mr Koka deposed that Mr Kasho said that he did not need to amend the plans as sliding windows would be included in the specification.
2. The specification, when finally negotiated, mandated that there would be awning windows at the front of the house and sliding windows for the remainder of the house. In the event, however, the builder installed awning windows all around the house.
3. Mr Koka seeks damages for the cost of removal of the awning windows where he wanted sliding windows and their replacement with sliding windows. Mr Buchanan costed all the required work, including ancillary work such as re-caulking and making good, at $47,106.
4. Looking at the matter from a legal point of view, the builder was obliged to build in accordance with the approved plans. That Mr Kasho understood this is confirmed by his evidence given on day one of the hearing, 14 August 2023, when, in answer to a question about Mr Koka's request to change the windows, he gave evidence that a change was not allowed.[70] The contract allowed for variations to be made at the request of the builder, but this process must be initiated by a written instruction from the builder by reason of the operation of a term implied into the contract created by s 38.1 of the DBC Act. This term is also expressly set out in the contract at clause 12.1. In his evidence, Mr Kasho specifically confirmed that Mr Koka had not asked for any changes after he signed the contract.[71] I find that Mr Koka did not make a written request to vary the windows in accordance with s 38(1) of the DBC Act and accordingly the builder was not permitted to deviate from the approved plans.
5. In fairness to Mr Koka, I note that when Mr Kasho amended the specification, a discrepancy was created between the specification and the approved plans. Under clause 3.2 of the contract, any discrepancy or ambiguity between contract documents is to be resolved in accordance with an order of precedence set out in that clause, and the order of precedence makes the specification dominant to the plans. If this clause were to be given effect, then the builder would have had to install the windows in accordance with the specification. However, this would have involved ignoring the approved plans and would have placed the builder in breach of the building permit, and so it would not legally have been possible to give effect to clause 3.2 of the contract.
6. The contract plans were prepared on behalf Mr Koka. The problem with the windows arose because long after the building permit has been issued, on the day the contract was signed, he changed his mind about the windows. He is no doubt disappointed that this change of mind could not be put into effect, but having regard to the limitations on a domestic builder's freedom of action under s 16 of the Building Act 1993 (Vic), and the strict rules governing the circumstances in which a variation to a domestic building contract can be made by an owner under s 38 of the DBC Act, I find that Mr Koka is not entitled to damages in respect this issue.
7. It was conceded by Mr Koka in his final submissions, at [60], that none of his experts suggested that the windows were defective in terms of functionality.[72] I consider that even if the installation of awning windows at the rear of the house was to be regarded as a defect, the cost of installing sliding windows when the awning windows called for in the approved plans have been installed and are operating satisfactorily, would not be a reasonable course of rectification to adopt. Furthermore, taking into account the fact that replacement would cost approximately $47,000, I find the replacement of the windows at this cost would be quite disproportionate to the issue at stake, particularly having regard to the fact that the original contract sum was only $363,000.
8. For all these reasons, the claim for a defect in respect of the installation of awning windows throughout the house is dismissed.

1. Mr Sherwood observed that the windows were covered with mortar and other waste. He referred to AS2047, clause 7.4 and suggested that the windows might be defective.
2. Mr Kosa observed that the windows had not been cleaned and had not been scratched. He did not accept that there was a defect.
3. As it is established that the window frames were affected by builder's waste, it is clear that they would have had to be cleaned either before hand over or during the maintenance period. Mr Kosa offered no evidence to assist in the quantification of rectification
4. Mr Buchanan costed the rectification of the window frame defect at $3,429. In the absence of any evidence contradicting this assessment, I will make an award based on it. Allowing for the deduction of one third in respect of the removal of preliminaries and margin, the award will be $2,286.

1. Mr Sherwood made reference to the warranties implied into the building contract by s 8 of the DBC Act and then appended a number of photographs. Specific comments followed about a number of issues.

1. Mr Sherwood observed that because of the lowered garage slab level, an unsightly concrete slab edge can be seen.
2. In my view, this issue is consequential upon the inappropriate site cut directed by Mr Koka. He must bear responsibility for these problems.
3. There was also a comment about the stormwater pit installed near the path being unable to remove all surface water, with the result that rainwater could enter the garage. A close reading of Mr Sherwood's report indicates that the path was installed by Mr Koka. This is not something for which the builder can be held responsible.

1. This defect is a repeat of the second limb of defect 56 above, namely marks on the window frames. No more need be said about it.

57.3 Pantry cabinetry not installed in accordance with approved plans

1. Mr Sherwood in his report of December 2019, at [57], noted the refrigerator cavity had not been placed in the spot indicated in the approved plans, and that the corner cabinets had not been installed at all.. Instead, the builder had recessed a void into the hallway.
2. These defects were also noted by Mr Camilleri in his report, at [1.41]. Mr Camilleri observed that due to the current layout of the cabinetry, the corner cabinet cannot be opened without hitting other doors and is not fit for purpose. Mr Camilleri opined that the problems with the pantry cupboards, the benchtop, the location of the refrigerator, the splash backs, the absence of a door to the pantry meant that the pantry had to be taken out and rebuilt in accordance with the approved plans.
3. Mr Kosa did not comment on these defects. I accordingly am satisfied that they exist.
4. Mr Buchanan set out an extensive list of items of work involved in the removal of the pantry (including removing and rebuilding some stud walls) and the reinstatement of the pantry (including reinstalling the stone benchtop and splashback) in accordance with the approved plans. Ancillary work such as retailing part of the floor to match the new cabinetry and repainting the plasterwork was also allowed for. The total price inclusive of preliminaries, builder's margin and of GST was $8,137. Mr Buchanan allow a separate figure of $1,202 in respect of the removal of the redundant niche in the hallway. The total of these two figures is $9,339. I will allow damages equivalent to two thirds of this figure, namely $6226.
5. Mr Buchanan allowed a separate figure of $1093

1. The fireplace selected by Mr Koka cannot be inserted into the rebate in the plaster created by the builder.
2. Responsibility for the late ordering of the fireplace has been discussed above, at [289]. Because the fireplace was selected late, Mr Koka must accept responsibility for the fact that the model he chose cannot fit into the rebate created by the builder. If builder had been asked to rebuild the rebate, this would have been a variation. I dismiss this claim.

1. Taps were installed out of level in the bathroom, the powder room and the ensuite. Mr Koka acknowledged through his experts that while the taps were fitted by him after termination, the reason they could not be fitted level was due to the mixes being installed inside the wall out of level by the builder.
2. A number of issues relating to the completion of the bathrooms were discussed in the Reasons, at [23]-[30]. A relevant point is that after the mixers had been installed in the wall of the bathroom, the selected bath was changed and a larger bath was ultimately installed.
3. For this reason, I cannot be satisfied that the fact of the taps being out of level in the bathroom was due to a mistake having been made by the builder's plumber. The problem may well be an inevitable outcome of Mr Koka changing his mind about fixtures in the bathroom at a late point. I dismiss this claim.

1. This item appears to be a replication of Mr Sherwood's observation that the pantry cabinetry was in the incorrect position and that a niche had been created in the hallway. See defect 57.3 above. No more need be said about this issue as it has been dealt with.

1. An issue identified by Mr Camilleri with the theatre room doors is that they had gaps of varied dimensions. They were out of tolerance having regard to the requirements of the VBA Guide to Standards and Tolerances. The cost to adjust the doors was assessed by Mr Buchanan at $459.
2. I accept the existence of the defect. I reduce Mr Buchanan's assessment by one third to account for the deduction of preliminaries and margin and will award $306.

1. This claim was not pressed as a separate issue in Mr Koka's final submissions. It presumably was rolled up into the issue of kitchen joinery generally.

1. The defect with the theatre room identified by Mr Camilleri is that it did not have insulation installed.
2. The cost to rectify this defect was assessed by Mr Buchanan at $4,912. This I figure is derived from the need to remove the existing plaster, place insulation, and then replaster the walls.
3. This is a separate defect to the issue of plaster walls being out of tolerance, which has been dealt with above.
4. I will make an award based on Mr Buchanan's assessment. Taking off one third for preliminaries and margin, the award will be $3,275 (rounded up from $3,274.67).

1. Mr Camilleri points out that cornices were not installed in the bedrooms and in the study as specified. The rectification cost claimed is $2,505, based on Mr Buchanan's assessment of what it would cost to install the cornices.
2. I accept the claim. I will make an award based on Mr Buchanan's assessment. I reduce $2,505 by one third to account for the removal of preliminaries and margin, and award the sum of $1,670.

1. Mr Camilleri documents a complaint highlighted by Mr Koka at the inspection, namely that the gas meter has been placed in front of the house rather than at the side. Mr Kasho's explanation is that the meter had to be placed at the front of the house in order to create sufficient distance from an adjacent electrical point.
2. Having reviewed the situation on site, I accept this explanation. Because it appears that the approved plan for the location of the gas meter could not be put into effect because of a potential conflict with building regulations, there will be no allowance for this claim.

1. Mr Camilleri remarked in his report about extensive cracking in the plasterwork in the house. Mr Camilleri based his report on an inspection on 2 July 2021, which was almost two years after the contract was terminated and many months after Mr Koka's had the plasterwork rectified. If anyone is to be held responsible for the present cracking in the plasterwork, it cannot be the builder. Mr Koka may have to look to his own plasterer.

1. Mr Camilleri expressed the view that some flooring workmanship is substandard. He highlighted a defect on an existing defects list. Mr Buchanan understood the issue, and priced the removal of a skirting board and its replacement using packing out in order to cover a defective finished floor edge. I allow Mr Buchanan's assessment of $278, subject to the routine deduction of one third. The award will be $185.

1. Mr Camilleri observed in July 2021 that the front door was damaged and opined that this was the responsibility of the builder. At this date the builder had been off-site for more than two years. I make no finding against the builder for this issue.

1. Mr Camilleri confirmed the bulkheads had been installed which were not on the approved plans. This issue has been dealt with. No more needs to be said about it.

SUMMARY OF AWARDS MADE IN RESPECT OF DEFECTS IDENTIFIED BY MR KOKA'S EXPERTS

1. I have made the following awards in respect of the following defects identified by Mr Koka's experts:
   1. Downpipes not connected: $450
   2. No articulation joints: $745
   3. Perpends $500
   4. Voids in mortar $278
   5. Mortar smears on brickwork $821
   6. Compromised articulation joints $353
   7. Weep holes contain excessive mortar $111
   8. Damp-proof course $1,713
   9. Voids in concrete $204
   10. Damaged bricks $500
   11. Colour bond downpipes, fascia and gutters damaged $1,700
   12. Roof tiles sitting proud $320
   13. Valley tiles not cut straight $1,429
   14. Chipped roof tiles $2,100
   15. Boundary garage wall $2,000
   16. Transfer lashing $724
   17. External windows and doors not sealed $400
   18. Cabinet margins not acceptable $426
   19. Shower wastes partially blocked $93
   20. Walls not within tolerances $5,115

1. Damage to valley irons $1,212
2. Roof tiles excessively overhanging gutter $2,345
3. Undulating roof tiles $1,250
4. Inconsistent mortar colour $300
5. Gas pipe exposed $88
6. Stormwater riser pipes not painted $150
7. Non-compliant door margins $184
8. Garage door fittings $232
9. Markings on windows $2286

57.3 Pantry not installed in accordance with approved plans $6,226

1. Theatre room doors $306
2. Acoustic insulation to theatre room $3,275
3. Cornices $1,670
4. Flooring defect $185

RELEVANCE OF FINDINGS REGARDING DEFECTS ON BUILDER'S ENTITLEMENT

1. I have found above, at [97], that the adjusted contract sum comes to $390,535. I have also found that when allowance is made for the $235,950 paid by Mr Koka before he terminated the contract, the balance notionally due on the adjusted contract sum to the builder is $154,585.
2. The total award in respect of defects of $41,056 identified above reduces the builder's notional entitlement from $154,585 to $113,529.

Mr Koka's claim for reimbursement of sums paid to third parties for rectification and completion works

1. Mr Koka seeks reimbursement for a number of invoices he says he paid after the date of termination so that he could move into the house as soon as possible. He seeks recovery of these invoices in respect of 25 items. They relate both to incomplete items and the rectification of defects. In some cases, defects were only partly rectified. The total of these invoices, according to Mr Koka's final submission, was $57,885.36.[73]
2. This figure contrasts sharply with Mr Kasho's assessment that at the time of termination the cost of completing the contract works was around $8,000. Mr Kasho supports his view by referring to the building permit issued to Mr Koka by the relevant building surveyor ('RBS') which estimated the cost of completion works at $8,360. Mr Kasho also notes that the completion works were disposed of quickly, as a certificate of occupancy was issued on 18 September 2019.
3. It follows that a large number of the invoices which Mr Koka is now seeking to recover must relate to defect rectification.

1. It is convenient to deal with this invoice at the outset. Mr Koka paid Singh Insulation $300 in respect of insulation. However, as noted above, this claim was not pressed in his final submissions because the contractor reimbursed the money, and this claim falls away.

1. Mr Koka deposes in his witness statement, at [47], that after termination of the contract he engaged Just Gas Log Fires Pty Ltd to alter the exhaust to the fireplace. The relevant invoice is dated 29 January 2020. I have found above, at [289] that Mr Koka must accept responsibility for the placing of the flue. The claim for reimbursement of this invoices is dismissed.

1. As a result of this change Mr Koka had to pay a bricklayer to reinstate the exit point in the brickwork where the builder had exited the flue. The relevant invoice is Fred's Top Bricklaying Pty Ltd, 28 February 2020. Because Mr Koka is the party who must accept responsibility for the location of the flue, this claim is also dismissed

1. Mr Koka seeks reimbursement of an invoice from Gazmor Murat dated 28 July 2019. The issue has been dealt with above. It will be reimbursed to Mr Koka. No further comment is required.

4 Bricklaying Invoice of Zaya Ibrahim 30 July 2019 for $3,200

1. This invoice has been dealt with above. No more need be said about it.

1. This invoice has been dealt with above. No comment is required here.

6 Invoice from Ben's Tiling $12,507 and materials invoices for $67.58 and $437.18

7 Waterproofing certificate from Majid Hirmez

1. In his witness statement, at [110]-[111], Mr Koka deposes that it was necessary to obtain certificates from various trades in order to get the RBS to sign the occupancy permit. He obtained some certificates from the builder through the efforts of his lawyer but could not obtain a waterproofing certificate. It was necessary for him to engage Majid Hirmez to perform some waterproofing works and to provide a certificate. He received an invoice for $1,100 from this contractor and seeks reimbursement.
2. Mr Kasho disputes liability. In his witness statement, at [82], he deposes that he would have provided a waterproofing certificate at completion. However, his company's contract was terminated before this happened.
3. In my view, the need for Mr Koka to procure a waterproofing certificate arose directly from Mr Koka's unlawful termination of the contract.
4. I raise a separate matter. At the time of the termination of the contract, the works were almost complete and the tiling was in place. In the wet areas, any waterproofing performed would have been covered by tiles. In this connection, I note that Mr Kasho deposed, at [89] of his witness statement, that Mr Koka had said that he was happy with the tiling performed. Mr Kasho had paid the tiler in full.
5. I question how Mr Hirmez could certify for waterproofing when the tiling was in place. Was all the tiling in wet areas re-done? Mr Hirmez was not called to give evidence and explain what work he did or why he did it. For these reasons, the claim is not made out on a factual basis.
6. I dismiss this claim.

1. At the time of termination of the contract, the builder had, according to Mr Koka, not installed locks to two bedrooms. Mr Koka says he paid for installation of the locks himself. He seeks reimbursement of this locksmiths invoice for $250 inclusive of GST.
2. Mr Kasho challenges this claim on the basis that he does not understand how this invoice relates to his works.[74] Reference to the specification does not assist Mr Koka. No locks are specified for internal doors. I dismiss this claim.

1. As Mr Koka deposed, every house requires caulking. According to Mr Koka, caulking was not completed at the time of termination. He engaged E/G Caulking Group to complete the caulking both inside and outside. The invoice was for $3,190.
2. Mr Kasho disputed liability, deposing that all exterior caulking had been finished when he left site and only the internal caulking remained.
3. The expert evidence supports Mr Kasho on the question of whether the external caulking had been done. This is not one of the approximately 75 defects asserted to exist by Mr Koka's experts.
4. Turning to the internal caulking, I note Mr Kasho's evidence is that the cost of caulking should be no more than $3 per metre. On this basis he queried how the internal caulking could cost $3,190.[75]
5. I note that Mr Koka did not call his caulker to give evidence. Furthermore, even though Mr Kasho had put the cost of caulking in issue, Mr Koka did not call any expert evidence about the matter.
6. Because Mr Kasho accepts liability for the cost of performing the internal caulking, is appropriate that I allow something. In the absence of any evidence about the meeting which caulked inside the house, I allow $100.

1. As Mr Kosa remarked on several occasions in his report, the specified concreting around the house had not been completed at the time of termination. Mr Koka deposed in his witness statement, at [114], that he obtained several quotations and engaged the cheapest contractor, Diamond Touch Concrete. He seeks reimbursement of that firm's invoice for $7,520.
2. Mr Kasho does not dispute liability for some concreting, but queries where the concrete was poured and why it was poured. He notes that the driveway would have been completed by him as part of the completion works if he had not been terminated. However, he does not query the amount charged by the concreter.
3. As the concreting constituted part of the completion works necessary of the contract, and as the quantum was not challenged, I will allow the concreter's invoice at $7,520.

1. Mr Koka engaged a separate contractor, JS Concreting, to complete the cutting and sealing of the concrete, as Diamond Touch Concrete was too busy. The second firm charged $880. I also allow recovery of sum.

1. Mr Koka deposes, at [117], that at the date of termination, the heating and cooling ducts had been installed, but the heating unit had not installed. He says that Mr Kasho had paid $6,000 of the contract price. He deposes that he had to the balance of the heating subcontractors price, $8,000, to get the firm to complete the installation. This implies that the subcontract price was $14,000.
2. Mr Kasho in his witness statement, at [97], confirmed that he had paid the heating subcontractor only $6,000. However, he says that the whole contract sum was $11,500, and that the extra costs paid by Mr Koka related to the fact that the system was upgraded. Reference to the Installation List indicates that the allowance for heating and cooling was "Refrigeration System Samsung ($11,500)", which conclusively supports Mr Kasho's evidence. As it is agreed between the parties that the builder had paid $6,000, I will allow recovery of $5,500 to Mr Koka, but not $8,000.

1. The invoice rendered by JJ Cabinet Design dated 13 September 2019 for $4,400 has been discussed above. Nothing more need be said about it here.

1. Mr Koka deposes in his witness statement, at [120], that he engaged Oz Windows & Security Doors to install a splashback, a mirror and shower screens in the bathrooms and also some cupboards. He deposes that he paid that firm's invoice of 24 September 2019 in the sum of $5,060.
2. Mr Kasho acknowledges that mirrors were referred to in the Installation List. Reference to the specification indicates that a polished edge mirror was required for each of the bathroom and ensuite. He queries the claimed cost of $5,060. I understand his point, as in my experience basic bathroom mirrors can be obtained for a cost of about $150 each.

1. The specification referred to a glass splashback in the kitchen.
2. I note that Mr Koka did not call his glazier to give evidence. Moreover, even though the cost of this item was put into issue by Mr Kasho's witness statement, Mr Koka did not introduce any expert evidence about this item. Nonetheless, I must make an assessment of damages.
3. Relying on my experience of hearing domestic building cases in the Tribunal over 10 years, I will allow $2,000 in respect of the splashback and mirrors.

1. At [121] of his witness statement, Mr Koka gives evidence that he selected appliances at The Good Guys and paid $6,300. The relevant invoice is dated 20 June 2019, which is just after the termination. He notes that the specification provided for appliances up to the value of $5,000.
2. Mr Kasho, in his witness statement, accepts that the amount provided for appliances in the contract was $5,000 but he notes that this figure was to cover the oven, the cooktop and the range hood, but not a dishwasher. Reference to the Installation List confirms Mr Kasho's evidence is correct.
3. As Mr Kasho accepts liability for the oven, cooktop and the rangehood, I will allow recovery of $5,000 in respect of this item.

1. Mr Koka deposed that he had to engage the RBS to carry out a final inspection as well as an inspection relating to the framing. He seeks reimbursement of invoices for these inspections.
2. Mr Kasho disputed liability in his witness statement.[76] He deposed that the additional inspections were required because of changes to the work required by Mr Koka, in particular to the frame stage. I accept Mr Kasho's evidence on this point, as Mr Koka did not explain why he had to pay for the additional inspections.
3. I note that the need for Mr Koka to engage the RBS to obtain a permit to complete the work was a matter arising directly from his unlawful termination of the contract.
4. For these reasons, I dismiss the claim for additional building surveyor's fees paid by Mr Koka.

1. Mr Koka deposes that he engaged DYS Fencing to deliver an 8 m³ skip bin to the site on 24 June 2019. A further bin was organised for September 2019. DYS invoiced for both bins on 17 January 2020. Mr Koka seeks reimbursement of this invoice.
2. Mr Kasho in his witness statement disputed the need for a skip to remove rubbish from the site at the time of termination. In these circumstances, it is surprising that Mr Koka required any bin, let alone an 8 m³ bin. Mr Koka did not support this claim with photographs.
3. Mr Koka did not support the second claim for bin hire with photographs either. Mr Kasho made a separate attack on this claim. He queried how he could be held responsible for rubbish left by Mr Koka's trades in September, which was months after he had left site. I regard this point as well made.
4. Mr Koka did not call anyone from DYS Fencing to validate either of the claims, even though they had been challenged by Mr Kasho.
5. I dismiss the claim for bin hire.

1. Mr Koka made a serious allegation concerning the builder in respect of this topic. It his witness statement, at [127], he alleged that the builder, after leaving the site, returned to sabotage the pipes.
2. Mr Koka deposed that he engaged Alpha RY Plumbing ('Alpha') to run cameras through the pipes and then used a jet blaster to clear them. Pipes that could not be cleaned had to be replaced. Alpha was also engaged to complete the fit off including the installation of the hot water service, cooktop, basins, kitchen sinks, toilets and dishwasher. The three out of level taps are also rectified. Mr Koka claims reimbursement of Alpha's plumbing invoice of $8,800, which is dated 24 September 2019.
3. I may make no finding about sabotage, but if it was necessary for the pipes to be tested and cleaned, then the relevant work would claimable, in my view. The issue with this aspect of the claim was proof of damage to the pipes. Mr Kasho, in his witness statement, said it was difficult to understand why the stormwater pipes were "faulty" and noted the absence of any photographs. He also said that it was not clear what stormwater pipes were replaced, and why they had to be changed.
4. Moreover, there was a real question about quantum, and I note that Alpha was not called to give evidence. This was surprising given the amount of the invoice.
5. I note that Mr Koka did not call any expert evidence in support of this claim. I dismiss the claim insofar as it relates to the Alpha invoice for $8,800.

1. Mr Koka claims reimbursement of a separate invoice for the hot water service, which was issued by Plumbcorp on 30 July 2019. I allow this claim at $880, as an instantaneous gas hot water service was allowed for in the Installation List[77] (which operated as the specification). Mr Kasho did not dispute liability.

1. Mr Koka deposes that he engaged CP Top Notch Roofing to install two downpipes. The cost of this work was $450, for which he seeks reimbursement. I allow this claim, as Mr Kerr found that some downpipes had been removed.

1. Mr Koka makes different claims about plumbing materials. The first is that he directly purchased a mixer and tap from Plumbcorp but was never reimbursed for those items.
2. I do not understand Mr Koka's complaint here. He was to be the beneficiary of the items purchased from Plumbcorp. Mr Kasho confirmed that they were installed. If Mr Koka purchased them and then requested reimbursement, they would simply have been invoiced to him by the builder in a future progress claim, together with builder's margin. I make no award in relation to the mixers and taps.

1. The second allegation is that after the building contract was terminated, the builder stole plumbing materials from the property. The items appear to include 6 mixers, tap sets and a spa pump. Mr Kasho queried how they could have been stolen when they had been installed. I regard this as a very good question. However, as discussed at the hearing, this is not a claim for breach of the building contract but for conversion. I make no award in relation to this allegation.

1. After termination, Mr Koka continued to purchase items from Plumbcorp including items for $2400, $2,150 and $150 (a laundry trough).
2. There is a factual dispute as to whether Mr Koka paid for items supplied by Plumcorp which were used in the house. In his witness statement, at [110], Mr Kasho deposed that he paid for all plumbing work in accordance with the specification at the property prior to termination. If all the specified plumbing items had been installed, it is hard to understand how the builder should be held liable for the cost to Mr Koka of purchasing further plumbing items after termination of the contract.
3. There is another issue with Mr Koka's evidence. If his evidences is accepted, this means that there has been a significant variation of the contract because a number of items have been taken out of the contract so that they could be supplied by the owner. There was no documentary evidence that this variation of the contract was implemented.
4. I raise a further issue. The plumbing items allowed for in the specification included mixer in the sink ($170), mixers to basins (3@$50), laundry trough mixer ($50), tapware to showers and baths (x4@$150) and a spa in the main bathroom ($1,800). According, I calculate the total maximum reimbursement available to Mr Koka would be limited $2,770. This figure is inconsistent with Mr Koka's claim.
5. For all these reasons, I dismiss the claim for reimbursement in respect of items purchased by Mr Koka from Plumpcorp after termination

1. Mr Koka deposed that he paid Somerton Windows $396 in respect of fly screens. I dismiss this claim on the basis of Mr Kasho said that he paid Somerton Windows $14,080 for doors and windows, including $420 for flyscreens. He referred to exhibit NK 57 in his witness statement which supports his evidence. I accept Mr Kasho's evidence on this point, and dismiss this claim.
2. Mr Koka also deposed that he paid Illusion Australia $400 for a fireplace frame. This claim is dismissed on the basis that the specification did not include a fireplace frame.

1. Mr Koka complains that the builder did not complete the rendering at the front of the property as required by the plan. He seeks reimbursement of an invoice for $2,530 for having the rendering completed.
2. Rendering was not one of the issues identified by his expert Mr Kerr in the month prior to the termination of the contract. However, Mr Kasho in his witness statement, at [113], concedes that a third coat of render remained to be applied at the time of the termination. He says the cost of this would be less than $1000. In the absence of any evidence to the contrary presented by Mr Koka, I allow $950 for this item.

1. Mr Koka set out his evidence about painting at the house from [137] of his witness statement. He deposed that the contractor engaged by the builder, Master Class Painting Pty Ltd ('MPC'), was to be paid $11,000 in total. He said that the builder paid $5,500 prior to termination of the contract. Mr Koka seeks reimbursement of the payment he deposed he made in order to pay out the contract sum, which of his account would be $5,500.
2. Mr Koka's evidence about the painting subcontract is inconsistent with Mr Kasho's evidence in several respects. Mr Kasho deposed in his witness statement at [38 (d)] that Mr Koka wanted to engage Naij from MPC as he was a relative of Mr Koka's. Mr Kasho says that he negotiated a price with Naij of $8,800, plus one day's labour plus the provision of protective plastic floor covers. The value of the contract accordingly was about $1500, which is $1,500 less than the figure contended for by Mr Koka.
3. The difference between the price contended for by Mr Koka and the price identified by Mr Kasho may be explained by Mr Kasho's evidence that Mr Koka directed the painter to enhance the finish of the doors and instructed that further works be carried out.
4. As I have found Mr Kasho to be more reliable than Mr Koka in respect of a number of issues, I will accept for the purposes of determining this issue that the value of the painting subcontract was $9,500. Mr Kasho did not dispute that he had paid the painter only $5,500. On this basis, I accept that Mr Koka was left with responsibility for paying the balance of the original painting subcontract price, namely $4,000. I will award this sum to Mr Koka in respect of painting.
5. Mr Koka also makes a separate claim in respect of other work done by MPC including installing skirtings throughout the house and supplying and installing a pedestrian door to the rear of the garage. These appear to be necessary completion works, but the claims are not supported by Mr Koka's experts. I dismiss these claims.

1. Mr Koka deposes that following termination of the contract he needed to assemble certificates in order to obtain a signoff on occupancy from the building surveyor. One of the certificates required related to termite protection. He asked Mr Kasho to produce the certificate and Mr Koka said it took a long time for it to be provided. In the interim, Mr Koka engaged another contractor Aussie Pest Solutions. That contractor went to the site and performed termite protection. The contractor then advised Mr Koka that termite protection works had not previously been performed. Mr Koka seeks reimbursement of the sum of $1,298 paid to Aussie Pest Solutions in respect of an invoice dated 14 August 2019.
2. I note two matters. The first is that the builder ultimately did produce a termite protection certificate. It was not made clear by Mr Koka that Mr Kasho's tardiness in providing the certificate had any effect on the issue of the occupancy permit by the RBS. For this reason, it is not possible for me to make a finding that it was necessary for Mr Koka to go to a second contractor to obtain a termite certificate.
3. The second point is that Mr Koka, in effect, asserts that the builder's termite protection certificate was fraudulent. Mr Kasho deposed that 2 termite protection certificates were issued by his contractor, the first after the underground plumbing and the second before the frame stage. He deposed that both certificates were issued after termite protection works had actually been performed.[78]
4. Mr Koka did not call anyone from Aussie Pest Solutions to give direct evidence about the question of whether the builder had performed asset protection works. In these circumstances the weight of the evidence rests clearly with the builder, and I dismiss this particular claim.

1. Mr Koka claims reimbursement of an invoice paid to a locksmith who was engaged on the date of termination of the contract to change the locks. I dismiss this claim, as the termination of the contract was unlawful. If the builder had not been unlawfully terminated, there would have been no need to change the locks on 21 June 2019.

1. There is a separate claim in relation to the cost of security cameras which were installed at Mr Koka's request by the builder's electrician in April 2019. Mr Koka deposed, at [147] of his witness statement, that Mr Kasho removed the video recorder and cameras from the property on the day of termination. This is a serious allegation. The claim for damages is a claim for conversion rather than a breach of the contract. I make no finding about it.
2. Mr Koka then asserted that he believed the builder had removed a replacement camera after an incident that occurred on 26 June 2019 at the property. Again, I make no finding, as any claim for damages for this item is not a claim for breach of the contract.

1. Mr Koka then makes a claim for reimbursement of invoices relating to external monitoring of two cameras installed at the property. I dismiss this claim as Mr Koka made a decision to install the cameras, which were not part of the contract scope, and then decided to have them monitored.

1. Mr Koka's conceded in his witness statement, at [155] that part of an invoice from DYS Fencing that related to fencing could not be claimed as fencing was not part of the contract.

1. However, Mr Koka claimed reimbursement of the balance of that invoice, $9,658, which he said related to the retaining wall. As has been discussed previously, any claim in relation to the retaining wall made by Mr Koka must be dismissed because he is the party who must accept responsibility for problems with the retaining wall which related to the site cut which he arranged.

1. I have made above the following awards in respect of the following claims reimbursement of invoices:

1. Concreting $7,520 & $880= $8,400
2. Heating $5,500
3. Mirrors and splashback $2,000
4. Appliances $5,000
5. Plumbing- hot water service $880

RELEVANCE OF FINDINGS REGARDING MONIES PAID TO THIRD PARTIES ON BUILDER'S ENTITLEMENT

1. I have found above, at [409], that the total award in respect of defects reduces the builder's notional entitlement to $113,529.
2. The findings made regarding Mr Koka's entitlement to be reimbursed in respect of invoices paid to third parties reduces the builder's entitlement by a further $27,280 to $86,249. I will make an award this sum to the builder.
3. There will be ancillary orders concerning any application by the builder for interest and any application by either party for costs or reimbursement of fees.

[1] Tribunal Book (TB) 1366. (This was the fourth report produced by Mr Buchanan).

[2] [1954] HCA 36 - [1954] HCA 36; 90 CLR 613.

[8] That payment occurred in October 2018 is not an issue, but Mr Kasho in his witness statement, at [18], says this occurred on 30 October 2018, not on 1 October 2018 as alleged.

[9] The lock-up stage invoice dated 15 January 2019 is endorsed "Paid on 24/01/2019". See TB 647.

[13] Cardona v Brown [2012] VSCA 174.

[14] ( 2019) 267 CLR 560; [2019] HCA 32.

[15] Contract Appendix, Item 8, TB 586.

[16] [2022] VSCA 209

[17] Mr Kasho's witness statement, [40]-[41].

[19] On 19 January 2019 Mr Kasho wrote to Mr Koka referring to the steel lintel, TB 651. The engineer approved the lintel in an email dated 29 January 2019, TB 653

[20] Exhibit NK2 Mr Kasho's witness statement, TB 670 4 o'clock.

[23] (2009) 83 ALJR 390; [2009] HCA 8.

[24] [1977] 1 WLR 1262; [1978] 1 All ER 33.

[25] [2017] SASCFC 72.

[28] First Sherwood report, 22 June 2019, TB 920.

[29] Second Sherwood report, 3 July 2019, TB 982

[36] Transcript of hearing on 23 October 2023, p 17.

[41] Mr Buchanan's fourth report, 8 July 2021, TB 1366 at 1373.

[43] Mr Kosa's report dated 15 October 2019, TB 1152, at 1158.

[44] Mr Koka's final submissions, 12 March 2024, [27].

[45] Mr Koka 's witness statement, [57].

[46] [2009] WASCA 87.

[47] These defects identified in the Mr Koka's final submissions, at [77].

[48] Mr Koka's witness statement, [57], TB 368.

[50] [1977] 1 WLR 1262 at 1270; [1978] 1 All ER 33 at 42.

[52] Mr Kosa's report at item 16, TB 1171.

[53] See Mr Camilleri's report at [1.11] TB, 1492; [1.12], TB 1494 ;[1.13], TB 1495; [1.26], TB 1516; [1.27], TB 1517 and [1.28], TB 1518.

[54] Transcript, 18 August 2023, 559, 29-31; 560, 1.

[55] Mr Koka's final submissions, [25].

[60] Mr Koka's witness statement at [118], TB 379.

[62] Mr Koka's witness statement, TB 304, 385.

[63] 64 Mr Koka's witness statement, [27]-[30], TB 363.

[66] Mr Camilleri's report [1.26], TB 1516.

[67] Mr Sherwood's report of December 2019, [35], TB 1120.

[68] Mr Camilleri's report [1.29], TB 1519.

[69] Mr Sherwood's December 2019 report, TB 1139 at [51]

[70] Transcript (TS), 14 August 2023, 96, line 26.

[73] Mr Coker's final submissions, [74].

[74] Mr Kasho's witness statement, [94].