1. On 9 May 2019, the Builder commenced this proceeding. It was stated in the application form that the Builder sought an urgent hearing because there was an application for voluntary deregistration of the Developer. The amount claimed in the Application was $1,330,526.13.
2. According to the Points of Claim, which accompanied the Application filed:
   • (a) the contract was a cost-plus contract, whereby the contract price was to be:
     • (i) the "direct costs" within the meaning of the contract;
     • (ii) a builder's fee of $176,000.00, inclusive of GST; and
     • (iii) a further 10% on any increased scope of works.
   • (b) works commenced in February 2017;
   • (c) a certificate of occupancy was issued in May 2018;
   • (d) on 12 June 2018, the Developer purported to terminate the Contract pursuant to s.41 of the Domestic Building Contracts Act 1995;
   • (e) before the purported termination, the Developer had underpaid progress invoices;
   • (f) there is a balance of $194,970.36 owing to the Builder with respect to invoices that it has rendered;
   • (g) the purported termination was a repudiation of the contract by the Developer;
   • (h) the Builder accepted the repudiation by a letter from its solicitor dated 20 June 2018;
   • (i) the Builder has incurred costs for further work and materials supplied by it that it has not yet invoiced to the Developer, totalling $107,458.00, inclusive of GST. The Builder claims this sum from the Developer, plus "a reasonable profit margin of 30 per cent", totalling $139,696.44, inclusive of GST.
3. There is an alternate claim by the Builder in the Points of Claim for a quantum meruit, seeking payment of $995,839.33, which is said to be the difference between the value of the work and materials the Builder supplied and the payments it has received.

1. The proceeding was listed for directions on 3 June 2019. Mr Silver of Counsel appeared by telephone for the Builder but there was no appearance for the Developer. Directions were given for the filing of Points of Defence and any counterclaim by the Developer by 15 July 2019.
2. Paragraph 2 of the order provided that, if Points of Defence were not filed by 15 July 2019, the proceeding would be determined in favour of the Builder pursuant to s.78 of the Victorian Civil and Administrative Act 1998 (the VCAT Act). It seems likely that the reason for this paragraph was the non-appearance of the Developer and the pending application for its deregistration.
3. Directions were also given for the filing and service of Points of Defence to any counterclaim and for the filing and service of experts' reports, The proceeding was listed for a Compulsory Conference on 24 September 2019.
4. The order provided that the file was to be referred to a Tribunal Member on 18 July 2019 for the purpose of determining which order should be made pursuant to paragraph 2 and for the making of any necessary orders. This might not have been done, because the Tribunal's registry received an email on 12 September 2019 from the Builder's solicitors, seeking an order pursuant to s.78 of the VCAT Act.
5. On 13 September 2019, the Developer not having filed and served Points of Defence, the Tribunal made an order in Chambers that the proceeding was, pursuant to s.78, determined in favour of the Builder for damages to be assessed and listing the proceeding for hearing on 28 November 2019 for the assessment of the Builder's damages.

1. On 25 September 2019, the Registry received an application from the Developer

for access to the Tribunal file. The form of application, signed by its counsel, stated:

"Respondent's registered office changed shortly after this proceeding was commenced. The Respondent has not received any correspondence from the Tribunal or the Applicant until it received the orders of Senior Member Farrelly last Friday."

1. The preceding Friday was 20 September 2019. According to the Tribunal file, a copy of the order of 13 September was sent to each of the parties on 17 September 2019. The copy sent to the Developer was addressed to 51 Sandy Street, Nunawading 3131 (the Nunawading address). Access to the file was provided to the Developer's counsel on 25 September 2019.
2. On 23 October 2019, the Registry received an application by the Developer pursuant to s.120 for a review of the orders that had been made. The grounds for the application were stated to be as follows:

"1. On 10 May 2019, my solicitor, Glen Chiang of Align Law Group, received an email from Serena Hultgren, paralegal of Wainwright Ryan Eid, Lawyers, which attached a PDF file comprised of a VCAT application, Certificate of conciliation and an ASIC extract. That file did not enclose a Points of Claim.

2. I expected that Red Earth Development Pty Ltd (Aust) Pty Ltd or its solicitors would contact me or my solicitors with a Points of Claim or further orders.

3. On 30 May 2019, the Respondent's registered office was changed from 51 Sandy Street, Nunawading Vic. 3131 to my solicitor's office being c/o Align Law Group, Level 3, 257 Collins Street, Melbourne, VIC 3000.

4. I did not receive any correspondence from Wainwright Ryan Eid Lawyers nor the Tribunal until 19 September 2019.

5. On 19 September 2019 Mr Chiang received an email from Ms Rachel Oost, paralegal of Wainwright Ryan Eid Lawyers. That email attached a letter dated 17 September 2019, orders of Senior Member M. Farrelly dated 3 June 2019 and orders of Senior Member M. Farrelly dated 13 September 2019. This was the first time that I or my solicitors were aware of these documents.

6. On 25 September 2019 my legal advisors applied to inspect the Tribunal's file in this proceeding.

7. On 8 October 2019, the Tribunal permitted my legal advisers to inspect the Tribunal's file having reviewed the file, I am now aware of the following matters:

(a) on 3 June 2019, Senior Member M Farrelly conducted a directions hearing requiring, among other things, a points of defence to be filed by 15 July 2019 and set a compulsory conference for 24 September 2019, a copy of which went to 51 Sandy Street, Nunawading;

(b) on 12 September 2019, Ms Oost sent an email to the Tribunal's registry seeking orders for summary judgement; and

(c) on 13 September 2019, Senior Member M Farrelly ordered, among other things, that the proceeding was determined in favour of Red Earth Development (Aust) Pty Ltd.

8. On 10 October, Mr Chiang wrote to Ms Oost seeking her client's consent to set aside the orders made 13 September 2019.

9. On 14 October 2019, Jeanette Eid, Principal of Wainwright Ryan Eid, Lawyers, sent an email to Mr Chiang which stated that her client would not agree to setting aside the orders made 13 September 2019. That email attached a letter dated 9 May 2019 which sought to serve Heng Yang Developments Pty at "51 Sandy Street, Nunawadding"(sic.)

10. Later that same day, Mr Chiang sent an email to Ms Eid repeating his request to seek her client's consent to set aside the orders made 13 September 2019 on the basis of section 97 of the Victorian Civil and Administrative Tribunal Act 1998.

11. On 22 October 2019, Mr Chiang sent an email to Ms Eid requesting a reply to this email dated 14 October 2019.

12. Later that same day, Ms Eid sent an email to Mr Chiang confirming her client's position in the email dated 14 October 2019."(sic.)

1. In the application form seeking to have the orders reviewed or varied, Mr Ou said that the reason that he did not attend at the hearing, which was 3 June 2019, was that he was unaware of the hearing and the order of 23 September 2019 was made without a hearing.
2. The application describes the Developer's case that it wishes to argue at a hearing as follows:
   1. The Applicant's solicitors did not correctly serve the Application. The address should have been 51 Sandy Street in "Nunawading" rather than "Nunawadding".
   2. It is likely that the documents that were purportedly served in paragraph 1 did not include a Points of Claim given that the attachment provided to the Respondent's solicitors failed to include a Points of Claim.
   3. The Applicant's Points of Claim fails to refer to the correct contract between the parties. The parties subsequently agreed to a fixed price contract on 28 March 2017.
   4. The Respondent has obtained quantity surveyor reports, which show that the Applicant received monies in excess of the value of the works.
   5. In the event that the Applicant extends time under s.126 and grants this application for rehearing then the Respondent will file Points of Defence alleging the contract was validly terminated within the provisions of the contract. Further, the Respondent will seek to file Points of Counterclaim to seek recovery of damages suffered due to the Applicant's defective works."
3. On 25 October 2019, the Tribunal ordered in Chambers that the hearing fixed for 28 November 209 would be for the purpose of determining the Developer's application under s.120 of the Act.

1. The application to set aside the orders came before me for hearing on 28 November 2019. Mr J. Silver of Counsel appeared for the Builder and Mr A. Burnett of Counsel appeared for the Developer.
2. After hearing the evidence and submissions, I informed the parties that I would provide a written decision.

1. Evidence was given orally and by affidavit.
2. Mr Ou gave evidence in support of the application. He acknowledged that, on 13 May 2019, he received a letter from the Builder's solicitors dated 9 May 2019. The letter was tendered. It is addressed to the Developer at 51 Sandy Street, Nunawadding (sic.) VIC 3131 and also to the Eaglemont address.
3. At the time this letter was sent, the first address was the registered office of the Developer, save for the mis-spelling of "Nunawading", and the Eaglemont address was the site address, where Mr Ou was then living. He said that it was the copy sent to the Eaglemont address that he received.
4. The letter is marked for the attention of Mr Ou, and purports to enclose, by way of service, the Application, Points of Claim, Current Company extract of the Developer and the application to deregister the Developer.
5. Mr Ou said that, notwithstanding the text of the letter, no Points of Claim were enclosed with the letter. He said that he removed the stapler from the documents in the envelope, scanned them and sent them to his solicitor.
6. The final paragraph of this letter that he received from the Builder's solicitors reads as follows:

"Should the company be deregistered before the enclosed proceedings are dealt with, we put you on notice that should it be necessary for our client to take steps to reinstate the registration of your company, it will be claimed against you as Director personally and this letter will be produced on the question of costs."

1. There are no Points of Claim included with the letter and enclosures that Mr Ou produced and he swore that none were included in the letter that he received at the Eaglemont address.
2. He said that he did not respond because he was not sure what to do. He said there was a key item missing, which was the Points of Claim. He said that the absence of this made him think that this might be a negotiating tactic because, if they were serving a legal document, the Points of Claim would have been attached. He was asked in cross-examination whether he knew what Points of Claim were, and he said that, although he had not previously seen Points of Claim, his solicitor had told him what they were.
3. He said that he discussed the matter with his solicitor and gave instructions to change the registered office of the Developer to the solicitor's office. He said that he did that because it was better that the solicitor received the documents.
4. He said that the next letter he received was a letter dated 17 September 2019 from the Builder's solicitors enclosing copies of the orders that had been made on 3 June and 13 September 2019.
5. He denied that he was trying to hide from the Tribunal or that, by seeking the deregistration of the Company, he was trying to avoid paying the Builder.
6. When it was pointed out to him in cross-examination that the form of Application commencing the proceeding, which he acknowledged he did receive, said that the Builder was claiming a little less than one and a half million dollars from the Developer, he said that no claim for that had ever been made against him and that he thought that, if an application had really been made to the Tribunal, he would have received something from the Tribunal.
7. When it was further pointed out to him that the address for the Developer on the form of application was the Nunawading Address, he acknowledged that he did think that "this is where they think I am" and he wanted to ensure that all communications went to the new address. He did not say how he expected that to occur if he did not inform the Builder's solicitors or the Tribunal of the new address. By Rule 4.08 of the VCAT Rules 2008, the Developer was required to do so.
8. He agreed that the presence of the Nunawading Address in the Application form indicated that any notices would be going to the Nunawading Address but notwithstanding that, he had made no arrangements for mail to be redirected from that address, notwithstanding that it had been the registered office of the Developer for "a couple of years".
9. Although he said that he was afraid of "what has happened now" he said that he nonetheless made no enquiries whether anything had been received at the Nunawading Address.
10. He acknowledged having attended the conciliation at Domestic Building Dispute Resolution Victoria and understood from that that the Builder claimed to be owed money by the Developer but he said that he waited after the conciliation and nothing happened. He said that his statement in his deregistration application that the Developer has no liabilities was correct and he wanted to deregister the Developer because the purpose for it was finished. He said that, after he received the letter of 9 May 2019 from the Builder's solicitors, he asked his accountant about the deregistration application and was told that it had been put on hold.
11. There were two affidavits in opposition to the application sworn by its solicitor, Ms Eid. She deposed to the following facts.
12. Before commencing this proceeding, Ms Eid wrote to the Developer's solicitor, Mr Chiang, on 1 March 2019, stating that she acted for the Builder and that she understood that he acted for the Developer. She said that, "...in order to sensibly resolve this matter..." the Builder had engaged a building expert to inspect both dwellings, and suggested three dates upon which such an inspection might occur. She asked for a response.
13. In reply, on 7 March 2019, Mr Chiang confirmed that he acted for the Developer but then said:

"Our client is confused as to the purpose of the proposed inspection and the basis upon which your client is seeking access.

In any case, we are instructed that our client is no longer capable of procuring access to the abovementioned property (or part thereof)."

1. Since the Developer knew that there was substantial claim against it, and since it has sought to defend itself by claiming that the work is defective or of a lesser value, the purpose of such an inspection was obvious. Further, since Mr Ou was living in one of the units at the time, the suggestion that he was unable to procure access to either unit is not credible.
2. Ms Eid responded immediately, suggesting that, if it should be necessary for the Builder to make an application to the Tribunal for an order for access, it would seek costs. Notwithstanding this letter, by a further letter dated 12 March 2019, the Developer maintained its position of refusing access.
3. On 9 May 2019, Ms Eid conducted a company search of the Developer and ascertained that its registered office was the Nunawading address and the address of the sole director was the Eaglemont address. That search disclosed that strike off action was in progress.
4. Upon obtaining a copy of the deregistration application from ASIC, Ms Eid ascertained that Mr Ou had declared to ASIC that the Developer had no debts.
5. On 9 May 2019 Ms Eid's firm served a copy of the Application to the Tribunal that commenced this proceeding, along with the supporting documents, by registered mail addressed to both the Nunawading address (with the word spelt "Nunawadding") and to the Eaglemont address.
6. Ms Eid deposed that the enclosures with this letter of 9 May included the Points of Claim. The copy of the letter and enclosures that she exhibited to her affidavit included the Points of Claim. From her later affidavit, sworn 27 November 2019, she exhibited responses from Australia Post that:
   • (a) the letter sent to the Nunawading address was not collected within 10 business days and, according to the correct procedures, it should have been returned to Ms Eid's office but instead it has been lost in the post; and
   • (b) the Eaglemont letter was delivered.
7. She said that, on the same day, 9 May 2019, she wrote to ASIC informing it that there were monies owed by the Developer and objecting to it being deregistered.
8. On 10 May 2019, Ms Eid sent an email to Mr Chiang enclosing a copy of the Application "...filed yesterday with the Victorian Civil and Administrative Tribunal." In a later letter dated 14 October 2019, Mr Chiang acknowledged that he received this letter.
9. She then describes in her affidavit the steps taken and the orders made in the proceeding.
10. She said that, on 17 September 2019, she conducted a further search of the ASIC registration of the Developer and ascertained that it had changed its registered office to Mr Chiang's office on 23 May 2019.
11. She said that she then sent the letter dated 17 September 2019 referred to above together with copies of the orders to Mr Chiang's office.
12. On 10 October 2019, Mr Chiang wrote asking that the Builder consent to the setting aside of the order. On 14 October 2019 Ms Eid advised that the Builder did not consent.

1. The application is brought pursuant to s.120 of the VCAT Act. That section provides as follows:

(1) A person in respect of whom an order is made may apply to the Tribunal for a review of the order if the person did not appear and was not represented at the hearing at which the order was made.

(2) An application under sub-section (1) is to be made in accordance with, and within the time limits specified by, the rules.

(3) The rules may limit the number of times a person may apply under this section in respect of the same matter without obtaining the leave of the Tribunal.

(a) hear and determine the application if it is satisfied that the applicant had a reasonable excuse for not attending or being represented at the hearing; and

(b) if it thinks fit, order that the order be revoked or varied.

(5) Nothing in Division 3 of Part 3 applies to a review under this section."

1. By Rule 4.18 of the Tribunal Rules, an application under s.120 must be brought within fourteen days after the Applicant becomes aware of the order. It was acknowledged that the application was not brought within time and the Developer seeks to have the time extended pursuant to s.126 of the VCAT Act. That section provides as follows:

"126. Extension or abridgment of time and waiver of compliance

.......................................................................................

(2) If the rules permit, the Tribunal, on application by a party or on its own initiative, may -

(a) extend or abridge any time limit fixed by or under this Act, the regulations, the rules or a relevant enactment for the doing of any act in a proceeding; or

(b) waive compliance with any procedural requirement, other than a time limit that the Tribunal does not have power to extend or abridge."

1. It was not suggested that the Builder had suffered any prejudice by reason of the delay in bringing this application under s.120 and the matter was argued on the merits. Despite the lack of any satisfactory explanation as to why the application was not brought within time, in the absence of any opposition to the application for an extension, I am prepared to extend time.

When should an application for review be granted?

1. In the case of Alesci v Salbury [2002] VSC 475, Bongiorno J said:

"Section 120 is a section which is to be construed liberally. It would be difficult, I think, to put forward a case where a blameless non-attending defendant would not be entitled to review of an order made in his or her absence."

1. However, the re-opening of a proceeding is not made as of course. An order can only be made if the Tribunal is satisfied that the applicant had a reasonable excuse for not attending or being represented at the hearing. In that regard, I would repeat what I said in the case of Avonwood Homes v Milodanovic [2005] VCAT 1297:

"27. I accept that, in determining what is a reasonable excuse, the Tribunal should adopt a liberal approach; where for example the failure to attend is due to oversight or accident or the reliance upon one's solicitors. But these situations are very different to a situation where the failure to attend arises from the Respondents hiding themselves from the Applicant and the Tribunal. A liberal approach to the section has been taken (see for example Melhen v Transport Accident Commission [2005] VCAT 25, DFS Corporation Pty Ltd v Basyle Enterprise [2004] VCAT 931) but in the absence of an explanation that can be considered to be reasonable leave cannot be granted (see Russell v Transport Accident Commission [2004] VCAT 2507)."

1. Service of an application to the Tribunal commencing a proceeding is provided for in s.71 of the VCAT Act. Subsection (1) provides that an applicant must serve a copy of an application on each other party. However, subsection (2) provides that that does not apply if the Principal Registrar undertakes service on behalf of the applicant. It is the practice of the Principal Registrar in this list to serve a copy upon respondents, together with a notice of hearing, and that is what occurred in this case.
2. The point was taken on behalf of the Developer that the application was not duly served because of the misspelling of the word "Nunawadding" in the copy sent to the Developer by the Builder's solicitors.
3. Although the word is misspelt, the misspelling was not of such a nature as to cause confusion as to the suburb intended. Also, the postcode was correct.
4. Further, the Tribunal's file records that the application was served upon the Developer on 15 May 2019 by the registry sending a copy of the application to the developer at the Nunawading address together with a notice of the hearing fixed for 3 June 2019. There was no error in the spelling of the address by the registry.
5. I am satisfied that the Developer was duly served with the application.

1. Mr Burnett said that the Developer had a reasonable excuse for not attending, in that Mr Ou was unaware of the hearing.
2. Certainly, if a party was unaware of a hearing that will generally be a reasonable excuse for not attending. However, in the present case, Mr Ou would only have been unaware of the hearing if he did not receive the notice of hearing posted by the Tribunal to the Developer at the Nunawading address. According to the Tribunal file, the notice was sent on 15 May 2019 and it was not returned unclaimed.
3. Mr Ou also claimed to have been unaware of the order that was made on 3 June 2019. However, he would only have been unaware of that order if he had not received the copy of the order which, according to the Tribunal file, was posted to the Developer at the Nunawading address on 18 June 2019 and not returned unclaimed.
4. I thought that Mr Ou was an unsatisfactory witness and I am not satisfied that the evidence that he has given is credible.
5. He acknowledged having received the letter of 9 May 2019 from the Builder's solicitors which was addressed to the Developer at the Eaglemont address. He had a copy of the application. It was clear from the application that the Builder was claiming a very substantial sum from the Developer and that the address given to the Tribunal for the developer was the Nunawading address.
6. He now claims that the Points of Claim were not included in the envelope, contrary to the affidavit of Ms Eid. Yet neither he nor his solicitor contacted the Builder's solicitors to contradict the statement in the letter that the Points of Claim had been included.
7. His suggestion that the absence of Points of Claim made him think that this might only be a negotiating tactic and that the Builder's solicitors were not serving a legal document is not credible, given the fact that he discussed the matter with his solicitor and the letter that Ms Eid had sent to his solicitor on 10 May clearly stated that the proceeding had been issued.
8. Instead of instructing his solicitor to provide an address for service for the Developer, as required by Rule 4.08(2) of the Tribunal Rules, and take steps to defend the proceeding, that he must have known had been issued, he changed the registered office of the Developer. This was in the context of an application that he had already made to have it deregistered. If, as he claimed, he changed the registered office of the Developer to the solicitor's office because it was better that the solicitor should receive the documents, one would expect him to have notified the Tribunal and the Builder's solicitors so that they would know of the new address. That was required by Rule 4.08(3), but he did not do it.
9. He swore that none of the mail sent to the Nunawading address came to his attention. According to the ASIC search undertaken by the Builder's solicitor, the Nunawading address was the address of the registered office of the Developer and also its principal place of business.
10. I find it hard to believe that, after moving from that address, Mr Ou made no arrangements to forward mail to his new address.
11. I also find it hard to believe that, after learning from the Tribunal application form that the Nunawading address was the address for the Developer on the Application, and having concluded that that is where the Builder and the Tribunal would think that he was, Mr Ou made no enquiries from the occupier of that address concerning mail from the Tribunal or the Builder's solicitors.
12. I also think it unlikely that neither of the letters sent by the Tribunal to the Nunawading address came to his attention, considering that the Tribunal file does not show that either of them was returned.
13. I think it is more likely that Mr Ou was seeking to avoid the Builder and the Tribunal, perhaps to delay matters in the hope that the deregistration of the Developer would intervene so as to frustrate the proceeding. I cannot see any other reason why his solicitor would suggest in a letter to Ms Eid that he (Mr Ou) was "confused" about why an inspection by the Builder's expert was required. He could not have been confused.
14. In Avonwood Homes Pty Ltd v Milodanovic, I found that the only reason the Respondents were unaware of the hearing was that they had deliberately hidden themselves from the Tribunal and from the Applicant's solicitors by returning mail unclaimed and pretending not to be living at their address.
15. The thrust of the s.120 application in the present case is that neither Mr Ou nor Mr Chiang was aware of the hearing fixed for 3 June 2019 and they were awaiting the arrival of Points of Claim. However, they both knew that proceedings had been issued, claiming an amount of over $1.3 million. I note that Mr Chiang did not give evidence to explain his involvement in the matter or his understanding in regard to the proceedings.
16. If, as he claims, Mr Ou was unaware of the hearing of 3 June 2019, the only reason for that would be that he had:
    • (a) chosen not to collect or open mail from his company's registered office;
    • (b) failed to provide an address for service;
    • (c) changed the registered office without informing the Tribunal and the Builder's solicitor;
    • (d) taken no steps to acquaint himself with what was going in relation to the proceeding.
17. By doing so, he cut himself off from any knowledge of the proceeding, and so disabled the Developer from being able to defend it. That can only have been a deliberate choice on his part.
18. The case is similar to that in Curcio v HGS and SPV Homes Pty Ltd [2003] VCAT 1041, where a party did not attend because it was claimed that he did not receive notice of the hearing or copies of the orders that had been made. In that case, as in this, the Tribunal's file indicated that letters were sent and not returned unclaimed. Deputy President Macnamara (as his Honour then was) said (at para. 15):

"15. Certain it is that there are instances where things go astray...accordingly, even although I think a Judge in a Court in Victoria would be entitled to take judicial notice of the fact that the mails in Australia are generally reliable and therefore sitting on a Tribunal I can do likewise with the more ample power that I have to inform myself as I see fit, the mails are not infallible and things can and do go wrong.

16. If matters went no further than this I believe the proper course for me would be simply to accept Mrs Kiriakidis' affidavit and despite the misgivings that I have as to the substance of the case that SPV might be able to make, grant this application.

17. However matters do go further. In SPV's case, not only did one notice not arrive, a second notice, namely the one covering the orders of the Tribunal. It is frankly difficult to credit and leaves one with the beginnings of some scepticism. There is also the fact that the notice from Housing Guarantee Fund Limited was despatched by registered mail.

......................................................................................................

20. Putting all these things together, lightning does strike sometimes .................. It is highly unlikely that it would strike twice, so close together in March and April; and when I put that together with the material relative to the earlier proceedings between the same parties I am forced to the conclusion that it is more probable then not that these communications, both of them, did in fact reach SPV. If SPV and its officers do not acquaint itself and themselves with the contents of those documents, it was not because they did not arrive. Hence I do not accept that there is a reasonable excuse for non-attendance and this application fails."

1. Similarly, I am not satisfied that the Developer had a reasonable excuse for not attending or being represented at the hearing of 3 June 2019. Consequently, I cannot make an order under the section.
2. The application will be dismissed. Costs will be reserved.