1. However, this offer was not accepted by the builder. The builder's counter-offer was set out in its lawyers' facsimile of 16 May 2007: that it would pay the difference between what the owners paid it for the air-conditioning unit and the amount they recovered from the insurer. This was accepted on the owners' behalf by their lawyers on condition that the amount paid by the builder for the unit be fixed in the sum of $12,879 [the amount offered by the insurer].
2. This was accepted on behalf of the builder by its then lawyers by the facsimile of 23 May 2007. Importantly, these negotiations and variations to the terms of settlement occurred prior to the owners signing the release required by the insurer.
3. Whether the agreement, as evidenced by the exchange of letters between the parties' lawyers, accurately reflects the owners' understanding or their instructions is a matter between them and their lawyers. The correspondence and ensuing agreement is quite clear: the builder agreed to reimburse the owners the difference between what it paid for the unit, fixed in the amount of $12,879 as insisted upon by the owners through their lawyers, and the amount the owners recovered from the insurer - $12,879. Accordingly, there is no difference to be reimbursed.
4. If I am wrong, and the terms are not enforceable, I would still not allow the owners' claim for reimbursement of the additional amount they paid for the airconditioning system. Whilst it is clear that the McQuay unit was faulty and needed to be replaced there is no evidence at all that an alternative single unit would not have operated effectively. To the contrary, Sandhurst Airconditioning & Plumbing provided a quotation dated 23 October 2006 in which they proposed three alternative solutions, including the installation of a new Daikin Model FDY250 at a cost of $12,879 which formed the basis of the insurance settlement. The cost of the most expensive alternative was $15,939. Other cheaper options were suggested, including the repair of the existing unit at a cost of $4,356. I have heard no evidence that the Daikin Model FDY250 was unsuitable.
5. As noted above, the specification is vague. It simply provides for the supply and installation of McQuay split system zoned to two areas. The model and capacity was not specified. Although a provisional sum was not allowed for the airconditioning I am satisfied the specification provided for the installation of a one unit, dual zoned system. The installation of a two unit system is clearly betterment, and the owners are responsible for the additional cost. This claim is therefore dismissed.

1. Following the view Mr Brandrick conceded this is not a defect and no allowance is made.

2.7 Hairline cracks in external verandah ceiling - $138

1. Following the view Mr Brandrick conceded this is not a defect and no allowance is made.

1. At the view the cracking and caps in the pergola ceiling and cornices were apparent. Both experts agree this is a defect and agree that the appropriate method of rectification is to backblock, seal and cut in additional control joints. They agree that removal and replacement is not required. Mr Martin has estimated the cost of this work at $759 which I allow.

1. I will therefore order the builder to pay the owners the sum of $12,400.62 calculated as follows:

Insulation in roof space over low voltage downlights

Crack in wall near corner of dining room and hallway

1. The owners also claim reimbursement of 50% of the costs of the reports prepared by Mr Brandrick as set out in paragraph 39.
2. The terms clearly provide the parties will share equally the cost of the expert appointed under the terms to inspect and verify the works were complete, and to identify any outstanding or incomplete works and fix the cost for the carrying out of those works. The only appointment that could be said to have been in accordance with the terms was the initial appointment of Mr Brandrick, including his inspection on 15 December 2007 and preparation of the first report. The cost of this seems to be $1,275 - the first Archicentre invoice, and I find the builder is obliged to pay 50% of that cost, even though Mr Brandrick appears to have misunderstood the task he was engaged to perform. I allow $637.50.
3. The second Archicentre invoice was rendered in April 2008, apparently after Mr Brandrick inspected the further items identified by Mr McLennan in February 2008, and prepared the supplementary report. These are disbursements incurred by the owners in relation to the Schedule 2 items and were not incurred under the terms. They, together with the following disbursements, are otherwise included in the owners' costs of the reinstated proceeding.
4. The invoice rendered directly by Brandrick Architects are not directly connected with his appointment under the terms.
5. The costs of Cordia &Associates are not costs incurred pursuant to the terms. Cordia & Asscoaites were engaged by the owners on the recommendation of Mr Brandrick. Their engagement was not discussed with the builder or its representatives. Further, as discussed above, in respect of many items, Mr Cordia has estimated the cost of carrying out a different scope of works to the one identified by Mr Brandrick including Schedule 2 items which are additional to those the builder was obliged to rectify under the terms.
6. R J Styles & Associates - Mr Styles was engaged directly by the owners, not pursuant to the terms.

1. The owners claim interest from the date of the terms relying on clause 8 which provides they are entitled to the costs of reinstating the proceeding and interest from the date of the terms. I accept they have not incurred the cost of carrying out the works. Further, at the time the proceeding was reinstated, by consent, the cost of the works had not been fixed by Mr Brandrick as anticipated by the terms. In such circumstances, I am not persuaded it is appropriate to make any order for payment of interest without hearing further from the parties and accordingly I will reserve interest.

1. Mr Brandrick attended the hearing in response to a Summons to Appear issued at the request of the owners. Before he left the witness box counsel for the builder explained to him that he could ask the tribunal to order payment of his fees for responding to the summons. He said he would be seeking $6,000 - based on a rough calculation done in the witness box.
2. Mr Brandrick lives in Echuca. He carried out a further inspection of the property on the Friday prior to the hearing, he attended the tribunal on the first day of the hearing, the view in Bendigo and the tribunal again on the final day to give his evidence.
3. Section 104(4) of the Victorian Civil and Administrative Tribunal Act 1998 provides:

A person who attends in answer to a summons is entitled to be paid the prescribed fees and allowances (if any) or, if no fees and allowances are prescribed, the fees and allowances (if any) determined by the tribunal.

1. It seems to me that before any claim for payment of his fees can properly be considered Mr Brandrick should prepare a properly particularised tax invoice. This should be forward to the owners, in the first instance, for payment. If the owners do not pay, it will be then be a matter for him and his advisors as to the steps he takes to recover payment.

1. This has been a most unfortunate situation for the parties, not assisted by the failure of the expert appointed under the terms to perform the functions contemplated by them.
2. I will order the builder to pay the owners the sum of $13,038.12 and reserve interest and costs with liberty to apply.