//
© 2026 Zoe. All rights reserved.
Zoe is a legal information platform. Always consult the Federal Register of Legislation for authoritative text.
[2023] ACTSC 171
Supreme Court of the ACT
2023-07-07
Balla AJ
Original judgment source is linked above.
Source: the ACT Courts (www.courts.act.gov.au). Converted to plain text by ZoeLaw. Not the official version.
SUPREME COURT OF THE AUSTRALIAN CAPITAL TERRITORY
Case Title: O’Toole & Anor v M Johnson Building Pty Ltd (No 2) Citation: [2023] ACTSC 171 Hearing Date: Decided on the papers Decision Date: 7 July 2023 Before: Balla AJ (1) Judgment for the plaintiffs against the first defendant Decision: in the sum of $269,982.66. (2) The first defendant to pay two thirds of the plaintiffs’ costs of the proceedings up to 20 April 2023 and 100 per cent of the plaintiffs’ costs thereafter. These costs are to be assessed on an indemnity basis.
Catchwords: CIVIL LAW – BUILDING AND CONSTRUCTION – apportionment – costs Legislation Cited: Building Act 2004 (ACT) s 141 Law Reform (Miscellaneous Provisions) Act 1946 (NSW) s 5 Cases Cited: Baxter v Obacelo (2001) 205 CLR 635 Hyblewski v Bellerive Homes Pty Ltd [2019] ACTSC 44 Parties: Kate Mary O’Toole (First Plaintiff) Farooq Ahmed (Second Plaintiff) M Johnson Building Propriety Ltd (First Defendant) Capital Certifiers Pty Ltd (Second Defendant) Representation: Counsel M Robens (Plaintiffs) J Masters (First Defendant) Solicitors Harrington Hall Lawyers (Plaintiffs) O’Connor Harris & Co (First Defendant) File Number: SC 386 of 2021
BALLA AJ:
On 19 May 2023 I delivered my findings as to liability and damages and noted the agreement between the plaintiffs and the builder as to the apportionment of responsibility for the damage under s 141 of the Building Act 2004 (ACT) being: (a) The first defendant, the builder, – 85 per cent. (b) The second defendant, the certifier – 15 per cent.
A timetable was set for the parties to make submissions as to the mathematical outcome of my findings and costs, if agreement could not be reached.
The parties have agreed that the mathematical outcome of my findings is, in total, $287,084.00.
The parties cannot agree on how the agreed apportionment between the two defendants is to be applied to the sum of $287,084.00, nor on the appropriate Order for costs. They have provided written submissions in accordance with an agreed timetable.
It is common ground that: (a) The builder was retained to build the house. (b) The second defendant was appointed the certifier of the project. (c) The parties have agreed on a schedule headed “Plaintiffs Calculation of Damages”. It summarises the findings I have previously made, describing the work to be done as items A-L with items A-D shown as being subject to the second defendant’s supervision as certifier. That schedule sets out the amount calculated in accordance with my findings in respect of each item. As I have said the total is $287,084.00. The amount payable by the builder, after taking into account the 15 per cent payable by the second defendant for Items A-D is $269,982.66. (d) The plaintiffs’ claim against the second defendant was settled before the hearing commenced. On 20th April 2023, judgment was entered for the plaintiffs against the second defendant in the sum of $200,000 inclusive of costs.
Apportionment
Counsel for the builder submitted that the plaintiffs could not recover an amount in excess of their loss. This meant that the $200,000 paid by the second defendant, reduced the amount recoverable from the builder. Accordingly, it was submitted, the sum of $200,000 should be deducted from the total damages of $287,084 so that the builder should be ordered to pay $87,084 plus interest plus costs.
Counsel for the plaintiffs submitted that: (a) Items A-D on the agreed schedule were subject to the second defendant’s supervision. The builder should bear 85 per cent of the liability for those items. (b) Items E-L were wholly the responsibility of the builder and thus the builder should bear 100 per cent of the liability. (c) This would result in $269,982.66 being payable by the builder to the plaintiffs. (d) The consent judgment against the second defendant was for $200,000 inclusive of costs. It did not disclose the extent of liability accepted by the second defendant nor the amount allowed for costs. It was not relevant to the determination of the builder’s liability to the plaintiffs.
Decision on apportionment
I am not persuaded that either of the authorities referred to in the parties’ written submissions have any direct relevance to the matters to be determined by me.
In Hyblewski v Bellerive Homes Pty Ltd [2019] ACTSC 44 the Court noted that s 141 of the Building Act 2004 (ACT) only permits apportionment between “each defendant to the action who is found to be jointly or severally liable for the damage”. In that case, the claim against one of the two parties had settled on the first day of the hearing on the basis that the proceedings against that party were discontinued. The Court held this meant that there was only one defendant when the liability finding was made and, as a consequence, no apportionment under the section was possible.
That is not the case in these proceedings. The proceedings against the second defendant were not discontinued. Neither counsel suggested that the settlement of the claim against the second defendant meant that s 141 of the Building Act did not apply.
The decision of the High Court in Baxter v Obacelo (2001) 205 CLR 635 was considering the meaning and effect of s 5(1)(b) of the Law Reform (Miscellaneous Provisions) Act 1946 (NSW) and not on legislation in the ACT. The only ACT legislation pleaded in these proceedings or referred to in written submissions, providing proportionate liability, is s 141 of the Building Act.
I do not accept the approach suggested by counsel for the builder. There is no evidence before me as to the basis on which the settlement with the second defendant was calculated. Nor is there any persuasive evidence as to whether there is a significant overlap between the plaintiffs’ costs as against the builder and the second defendant as suggested by counsel for the builder. Accordingly, it is not possible to ascertain whether there would be “double recovery” by the plaintiffs if I used the approach sought by counsel for the plaintiffs.
The quantum of each head of damage has been agreed. The apportionment of liability as between the builder and the second defendant has been agreed. As I have said, the outcome of this has been documented and agreed on in a spreadsheet as $269,982.66.
Section 141(1) of the Building Act provides: 141 Limit of liability of people jointly or severally liable (1) A court that decides an award of damages in a building action must give judgment against each defendant to the action who is found to be jointly or severally liable for the damage for the proportion of the total amount of the damages that the court considers to be just, having regard to the extent of that defendant's responsibility for the loss or damage.
I accept the submission made by counsel for the plaintiffs that it is not my role to assess the damages payable by the second defendant, the purpose of the section is to determine the respective liability of each of the two defendants. The section provides that damages are to be assessed having regard to a party’s liability for the loss or damage. I am satisfied that this is reflected in the approach used by counsel for the plaintiffs.
I propose to enter judgment for the plaintiffs against the first defendant in the sum of $269,982.66.
Interest
Pre-judgment interest was not claimed by the plaintiffs.
Post judgment interest is claimed against the builder as the plaintiffs say it is the builder who is the only active party responsible for any delay resulting in interest accruing. I decline to make such an Order if it is intended by the plaintiffs that the interest should run from 19 May 2023. I consider it reasonable, after my Reasons were delivered, to have afforded the parties an opportunity to make written submissions in relation to the issues then considered in these further Reasons.
Costs
Counsel for the builder submitted that the general rule is that costs follow the event and that, had the matter continued with both defendants to finality, the Court would most likely have ordered the costs of the plaintiffs to be shared equally by the defendants.
Counsel for the plaintiffs submitted that the builder has known at all times that it would be liable for the majority of the damages and should bear 94 per cent of the costs consistently with the ultimate responsibility for damages.
I am not persuaded that the liability for costs is necessarily directly related to the matters relied on by counsel for the plaintiffs. In circumstances where I accept that the builder was responsible, with the second defendant, for some issues, and solely responsible for others I propose to order the builder to pay two thirds of the costs up until the date of the settlement with the second defendant and 100 per cent thereafter.
The plaintiffs rely on the following in seeking an Order for the builder to their costs of the proceedings on an indemnity basis: (a) An open letter to the builder dated 2 April 2020 before proceedings were commenced. (b) A Calderbank offer made on 19 May 2020 before proceedings were commenced, offering to accept payment of $100,000.00 in full and final satisfaction of all matters between the plaintiffs and the builder. The offer was open for 14 days. (c) A Calderbank offer made on 17 June 2020 before proceedings were commenced, offering to accept payment of $72,000 in full and final satisfaction of all matters between the plaintiffs and the builder. The offer was open for 14 days.
The builder does not dispute that any award of costs against it should be on an indemnity basis. I propose to make such an Order.
Orders
I certify that the preceding twenty-four [24] numbered paragraphs are a true copy of the Reasons for Judgment of her Honour Acting Justice Balla Associate: Priyanka Tomar Date: 7 July 2023
O'Toole & Anor
M Johnson Building Pty Ltd
(2001) 205 CLR 635