1. I find and declare that the respondent is liable to pay damages to the applicants.
2. The applicants' claim that their damages be assessed as the cost of demolishing and rebuilding their home ("Scenario One" in the costings prepared by Tom O'Dowd of Victorian Building Consultants Pty Ltd) is rejected.
3. Instead, the applicants' claim for damages is to be assessed as:

(a) the cost of rectification of defects ("Scenario Two" in the costings prepared by Tom O'Dowd of Victorian Building Consultants Pty Ltd) including rectification of plumbing defects insofar as those costings have been accepted by the Tribunal, as set out in the Reasons accompanying this Order; plus

(b) the cost of alternative accommodation and storage of chattels during rectification works (raised in paragraph 10 of their Amended Points of Claim); plus

(c) the applicants' cost of storing their caravan away from their home for a reasonable period of time (which is open under paragraph 10 of their Amended Points of Claim given the breadth of paragraph (b) of the Particulars under that paragraph).

1. Within 21 days the applicants shall file with the Tribunal and serve on the Respondent their calculation of the amount to be awarded under paragraph 3(a) above, having regard to the awards set out in the Reasons accompanying this Order.
2. Within 14 days of the service of the calculation under paragraph 3, the respondent shall file with the Tribunal and serve on the applicants any objection to that calculation, with an explanation. If no objection is filed, the respondent will be deemed to accept the applicants' calculation.
3. The Tribunal proposes to make an Order for the payment of the appropriate sum under paragraph 3(a) above shortly after its receipt of the respondent's objection, if any, which Order will be immediately enforceable.
4. The principal registrar is directed to list a directions hearing before me on a date to be fixed, at which the parties will be heard on the directions which ought be made to enable the damages referred to in paragraphs 3 (b) and ( c) to be determined efficiently and economically for the parties.
5. Costs reserved.

1. Mr and Mrs Stanley are the owners of a house in an outer suburb about 40 km north of the Melbourne CBD, which was built for them by EHW Construction West Pty Ltd ('EHW') under a major domestic building contract made in June 2018. It is relevant to the assessment of damages to mention here that the Stanleys are in their mid 60s and that they are both retired.
2. The Stanleys bought the block of land from a developer in 2017. The block is rectangular, of 594 sq metres, with a frontage of 18 metres[1] and a depth of 33 metres. The front of the block, and the house, face west. When looked at from the street, the 'left side' of the house and the block is north, and the 'right side' is south. The highest point of the block is the north west corner. The survey[2] obtained for the purposes of the Building Permit shows the datum of 9.98 at that corner. From there, the front of the block slopes slightly to the south west corner (9.52), and also to both rear corners (north east corner, 9.49 and south east corner 9.08). In other words, at the front boundary of the block, the south corner is 46 cm lower that the north corner. The survey also stated, at the south west corner, "Electric Pit RL 10.00". Mr Tom O'Dowd, expert witness called by the Stanleys, said in paragraph 1.1 of his report of 29 November 2021 that "The initials RL stand for "reduced level" which is a survey term indicating the value of a survey point with reference to a common assumed datum. In this case the surveyor has shown the electricity pit as the datum point of reference and all finished floor levels and other site levels are referenced to the top of the electricity pit". The accuracy of this explanation was not challenged by EWH.

The parties acknowledge that the developer imposed design guidelines[3] on purchasers including the Stanleys. These guidelines require a degree of uniformity in the appearance of houses built in the street. One consequence of the guidelines is that each of the houses on the Stanleys' side of the street - except theirs - has its garage and driveway on the south side. The Stanleys chose to have their garage and driveway on the north side, and obtained permission from the developer to put this into effect.

1. The Stanleys allege that there are three categories of defects in the house:

(a) EWH cut the site deeper than it should have, and did not compensate for this during the construction of the house. This has caused the finished floor level ('FFL') of the house and the garage to be about 130 mm lower than they should be, which makes the slope of the driveway greater than it should be;

(b) some general defects which are common in building cases brought in VCAT - matters such as deficient internal painting in some areas, gaps and cracks; and

(c) some plumbing defects, externally relating to the stormwater system, and internally in relation to such matters as the size of the waste outlet in the shower. EWH built the driveway, and the garage and house slabs. It also laid the external drains and stormwater system, and installed a water tank on the south east corner of the house, which would be fed from water draining from the roof. In the contract plans,[4] Sheet 2 contains Drainage Notes which required EWH to install surface drainage works in accordance with the engineer's design. That design[5] contained 23 Notes to the builder, including C11 which stated that all existing surface levels were as per architectural plan and or land survey plan; C12 which said the "builder (was) to take all responsibilities and liabilities for any changes to be done without the approval of the design engineer and/or respective council's inspector"; and C15 which said the "laying of new pipes and construction of pits shall be as per local council's standard details, specifications and as per National Plumbing and Drainage Code AS/NZ 3500.3.2015 and Building Code of Australia "Part 3.1.2 drainage". Sheets C-001 and C-002[6] set out the site drainage plan and drainage details. EWH did not lay the paving around the house. Some of the alleged plumbing defects are within, or encased by, that paving. The Stanleys' position is that EWH is liable for these defects because it installed the drainage and because the levels of the paving their contractor laid was dictated by the FFLs of the house and garage.

1. Seen in this way, the dispute is a rather standard one, with the parties in dispute in relation to whether or not items complained of by the Stanleys are defects, and the cost of rectification which turns on the manner in which proven defects would be rectified.
2. However, there is a feature of the Stanleys' case that takes their claim out of the ordinary. They assert that it was a fundamental goal of having this house built, that the house would accommodate their caravan and in particular allow the caravan to be reversed from the street along the driveway, through the panel lift door at the front of the garage and then through the roller door at the back of the garage into the paved rear garden. The Stanleys say that because the FFLs are too low, the driveway is too steep, that their caravan cannot be reversed along the driveway without being scraped and damaged on the bottom. The fall of the driveway prevents the caravan travelling down the driveway and through the garage. The scraping occurs on the footpath: the footpath is higher than the street, and when the caravan is reversed from the street, over the footpath and then down the driveway, the bottom of the caravan hits the footpath. When the caravan then goes from the sloping driveway onto the flat floor of the garage, the underside of the caravan strikes the driveway.
3. The Stanleys say, and I accept, that local Council parking restrictions make it unlawful for them to park the caravan in the street. The Stanleys say that their measure of damages in the circumstances is the cost of demolishing the house and rebuilding it, to be identical save for having FFLs at the height required under the contract, and not at the level that currently exists. The Stanleys say this will cost over $650,000.00. They say that it is not possible to rectify the FFLs of the garage, and reducing the slope of the driveway, without demolishing the house, and EWH's expert witness Mr Glenn Edwards conceded that this was so.[7] Clearly, if the house was to be demolished, the general and plumbing defects referred to in paragraph 3 (b) and (c) above would also be demolished and not separately rectified.
4. EWH defends the case, and does not concede that all of the items complained of are defects. More significantly in relation to the "bottom line outcome" of the case, EWH submits that assessing damages on the basis of demolition and rebuilding would be unreasonable, having regard to the principles enunciated in Bellgrove v Eldridge[8] and subsequent authorities.
5. The proceeding was vigorously argued and presented in the Tribunal, with both sides engaging legal practitioners and Counsel, calling expert witnesses and tendering many documents in a jointly prepared Tribunal Book supplemented with some 200 additional pages of documents tendered during the hearing.[9] The written submissions were thorough in some respects, particularly on the niceties of Bellgrove v Eldridge. The parties' respective experts had prepared costings in 2021 and updated them for the hearing: Mr O'Dowd for the Stanleys preparing new costings which also costed rectification of the plumbing issues which were raised after his first report, and Mr Edwards for EWH applying a 30% increase on his 2021 figures to account for price rises since then.
6. Mr O'Dowd's last costing, dated 21 November 2023, contained two alternatives:

"Scenario One" in which the house would be demolished and rebuilt. He costed this at $652,197.20 (including a contingency of 10%, builder's margin of 25% and GST) but said that the cost of up to 8 months' alternative accommodation and storage of furniture would have to be added; and

"Scenario Two", based on rectification of defects without demolition of the house. He costed this at $136,429.00 (including a contingency of 10%, builder's margin of 25% and GST) but said that the cost of up to 10 weeks alternative accommodation would have to be added.

1. EWH submitted that the Stanleys should have the opportunity to present evidence on the cost of alternative accommodation, once it was determined whether the appropriate measure of damages was Scenario One or Two. It is of concern that the proceeding cannot be fully determined by way of this Order, despite there having been a multi-day hearing and the exchange of two sets of written submissions.
2. The Stanleys use the abbreviation "Caravan Requirement" as the abbreviation of their desire that the house enable the caravan to be reversed down the driveway, through the garage and stored in the back yard.

1. In Teen Entertainment Enterprise Network Pty Ltd v A & H Natoli Pty Ltd, the Supreme Court held that the Tribunal makes an error of law if it determines a case on a basis which was not raised in the parties' pleadings or otherwise during the hearing, because to do so would deprive a party of its right to procedural fairness.[10] Whilst section 98(1)(b) of the Victorian Civil and Administrative Tribunal Act 1998 (Vic) provides that the Tribunal is not bound by the practices or procedures of the Courts, the Building and Property List commonly requires parties to file and serve pleadings and, through their lawyers, the parties have done so in this proceeding. Teen Entertainment therefore requires an analysis of the pleadings.
2. The Stanleys plead their claims as one of breach of express and implied terms of the parties' contract. This is plain from paragraphs 8, 9 and 17 of the Amended Points of Claim dated 31 October 2022, and from the absence of any pleading that EWH engaged in misleading or deceptive conduct contrary to section 18 of the Australian Consumer Law (Victoria).
3. The express terms are alleged to be set out in clause 11 of the parties' major domestic building contract dated 3 June 2018.[11] Much of clause 11 mirrors section 8 of the Domestic Building Contracts Act 1995 (Vic), but the first and sixth bullet points go further, by saying that "To the extent required by the Domestic Building Contracts Act the Builder warrants that:

the Building Works will be carried out in a proper and workmanlike manner and in accordance with the plans and specifications set out in this Contract (and)

if this Contract states the particular purpose for which the Building Works are required, or the result of which the Owner wishes the Building Works to achieve, so as to show that the Owner relies on the Builder's skill and judgement, the Building Works and any material used to carry out the Building Works will be reasonably fit for that purpose or will be of such a nature and quality that they might reasonably be expected to achieve that result".

Section 8(f) of the Domestic Building Contracts Act 1995 says that this warranty is "part of" the parties' contract:

if the contract states the particular purpose for which the work is required, or the result which the building owner wishes the work to achieve, so as to show that the building owner relies on the builder's skill and judgement, the builder warrants that the work and any material used in carrying out the work will be reasonably fit for that purpose or will be of such a nature and quality that they might reasonably be expected to achieve that result.

1. The Stanleys allege the existence of the contract in paragraph 8, and the contract including the warranties under section 8 of the Domestic Building Contracts Act and clause 11, in paragraph 9 of the Amended Points of Claim dated 31 October 2022. EWH admitted the existence of the contract in paragraph 8, and the whole of paragraph 9, in paragraphs 8 and 9 of its Points of Defence dated 9 December 2022.
2. EWH amended its Points of Defence on 29 November 2023, by agreement. It did not amend paragraph 8. The text of paragraph 8 of the Points of Defence is, "[EWH] admits the contract was entered into on 3 June 2018, but denies the allegation contained in paragraph 8 (of the Amended Points of Claim) that the contract incorporated the alleged Caravan Requirement as an implied term, and relies on the written building contract as to what was agreed to be constructed".
3. There is an obvious problem created by EWH in paragraph 8 of the Points of Defence: by expressly relying on the written contract EWH relies on the sixth bullet point of clause 11. The Stanleys clearly allege under the sixth bullet point that EWH warranted that it would achieve the result of satisfying the Caravan Requirement. Whether or not satisfying the Caravan Requirement was an implied term, doing so was an express obligation under the sixth bullet point of clause 11.
4. The Stanleys say that the words "if this Contract states the particular purpose for which the Building Works are required" in the sixth bullet point of clause 11 do not assist EWH, because the phrase does not mean 'if the written form of the contract to the exclusion of all other communications states the particular purpose...'. The Stanleys say that they stated the Caravan Requirement very clearly to EWH's Sales Manager, Dominic Cugliari. They also say that the "plans and specifications" referred to in the first bullet point of clause 11 included the FFLs, which EWH did not achieve.
5. It is necessary to trace the Caravan Requirement through the Amended Points of Claim.
6. In paragraph 8 of the Amended Points of Claim the Stanleys allege that they entered a major domestic building contract with EWH on 3 June 2018 under which EWH agreed to design and construct a single storey home and garage for them on their land, which contract "incorporated the Caravan Requirement" (which expression is defined in paragraph 6). In the Particulars under paragraph 8, they allege that the contract was partly written and partly implied. To the extent it was written, it was contained in the "Victorian New Homes Contract" which EWH had presented to them. In paragraph (c) of the Particulars they allege that to the extent that it was implied, "it was implied to give effect to the Caravan Requirement and all laws and regulations including but not limited to the Domestic Building Contracts Act 1995 and the Building Act 1993" (emphasis added). In paragraph 9 of the Amended Points of Claim the Stanleys allege that the contract included the warranties imposed by section 8 of the Domestic Building Contracts Act 1995.
7. The Particulars under paragraph 9 say that the section 8 warranties were included in the contract by virtue of that section and "by way of clause 11", and sub-paragraph (b) of the Particulars of the contract under paragraph 8, refer to the whole written building contract. It follows that EWH was on notice that the Stanleys relied on the whole of clause 11 including the sixth bullet point.
8. Whilst sub-paragraph (c) of the Particulars of the contract under paragraph 8 does not expressly give particulars of the alleged implied term (ie, in the sense of asserting that the implication arose from conversations or the like), the only fair way to read the Stanleys' pleading is to recognise the allegations of the parties' pre-contract communications in paragraphs 4, 5, 6 and 7 as containing those particulars.
9. In paragraph 6 of the Amended Points of Claim the Stanleys use the defined expression "Caravan Requirement" to mean that any home constructed by EWH must "take into account their caravan in relation to the grading of the... driveway and the front and back doors of the... garage".[12] This definition is preceded by allegations that when, in November 2017, they inspected a display home of EWH they spoke to EWH's Sales Manager, Domenic Cugliari, and:

(a) told him that the reason they were looking to move homes and build their own home on their land was due to difficulties they were facing in relation to the storing of their caravan at their current residence;

(b) told him that any new home built on their land would need to be built around their caravan so as to allow the caravan to be easily stored in the backyard of the new home through the new dwelling's garage; and

(c) hand delivered to Mr Cugliari an informal sketch[13] of their desired home and confirmed that they required panel lift garage door openings of 2380 mm height and 3000 mm width at the front of the garage, the latter exceeding the 'standard inclusion' of 2400 mm. The Stanleys allege that Mr Cugliari said that if the height of the openings was to be 2380, the ceiling heights would have to be 2700 mm, and that a 3000 mm wide panel lift door was not possible.

1. The Stanleys allege that a preliminary building agreement was given to them by EWH in February 2018, which EWH represented was a quotation; that on 10 March 2018 the Stanleys reiterated their "Caravan Requirement"; and that on the same day EWH said in writing that its quotation was still open to be accepted and that the Caravan Requirement would be provided to the relevant draftsperson in order to ensure that the Caravan Requirement was incorporated into relevant plans and designs for the new dwelling.[14]
2. The Stanleys allege that on 11 March 2018 they paid $2,000.00 to EWH in consideration of it preparing all designs, plans, specifications and contracts with respect to the construction of a new home which incorporated the Caravan Requirement, and that on 3 June 2018 they entered a major domestic building contract with EWH which was partly written and partly implied: to the extent it was written, it was in the written contract and documents referred to therein, and to the extent it was implied, "it was implied to give effect to the Caravan Requirement".
3. The Stanleys allege that EWH carried out building works between 11 September 2018 and 9 May 2019, and that the occupancy permit was issued on 17 May 2019. On 17 May 2019 the Stanleys attempted to manoeuvre their caravan into the garage, before the driveway had been constructed, and found that they were unable to do so. On 18 May 2019 they emailed EWH and said that their understanding was that once the driveway was completed it would allow for a smoother transition down to the garage, that they hoped the battery box of the caravan would clear the footpath, and they asked EWH to have the driveway completed prior to the handover of the works, stating that it would be most important to them to get the driveway completed before settlement so that they could do another trial before they moved in. The Stanleys allege they moved into the dwelling on 1 June 2019, at which time the driveway was incomplete because of inclement weather.
4. The Stanleys allege that after the driveway had been completed in July 2019, they became aware that the caravan could not pass down the driveway, and that they immediately emailed EWH, and:

(a) confirmed that the Caravan Requirement had been part of the building works since the date of the initial discussion;

(b) confirmed that it had been represented to them that the Caravan Requirement had been incorporated into the building contract via its incorporation into the relevant plans, designs and specifications of the building contract;

(c) questioned whether EWH ensured that the Caravan Requirement was made part of the building contract via its incorporation into the relevant plans, designs and specifications; and

(d) alleged that the Caravan Requirement was not incorporated into the constructed building works.[15]

1. The Stanleys allege that EWH replied on 9 July 2029, confirming that the Caravan Requirement was part of the Building Contract via its incorporation in the relevant plans, designs and specifications.[16]
2. In its Amended Points of Defence dated 29 November 2023 EWH:

(a) admitted that the Stanleys met "a salesperson" - subsequent paragraphs confirming that this was Mr Cugliari - at its display home in November 2017, in which the Stanleys said they wanted the garage door to be constructed at a height to accommodate their caravan, but otherwise denied the allegations in paragraph 4 of the Amended Points of Claim;

(b) admitted having received from the Stanleys their informal sketch of the proposed new home, but did not admit the allegations of Mr Cugliari stating specific garage door heights or widths;

(c) admitted having received the payment of $2,000.00 but denied that the contract documents were to include the Caravan Requirement;

(d) admitted having submitted the preliminary building agreement in February 2018, as a quotation;

(e) In stating that "save to say that the email speaks for itself", admitted the Stanleys' allegations in paragraph 6(b) of the Amended Points of Claim that on 10 March 2018 it told them the quote was still open to be accepted, that the Stanleys reiterated the Caravan Requirement,[17] and that the Stanleys sought confirmation that EWH could make arrangements with the relevant design engineers to address the Caravan Requirement;

(f) denied the Stanleys' allegations in paragraph 6(c)(ii) of the Amended Points of Claim that EWH would provide the Caravan Requirement to the relevant draftsperson to ensure that it was incorporated into the relevant plans and designs;

(g) denied that the building contract was to incorporate the Caravan Requirement;

(h) admitted the building contract was entered into on 3 June 2018, but denied that it could contain compliance with the Caravan Requirement as an implied term.[18] EWH said it relied on the written building contract. I note here that in its submissions EWH said the written contract contained clauses that the contract was complete in itself and overrides any earlier agreement, whether made verbally or in writing. However this still leaves in place EWH's admission of the sixth bullet point of clause 11 of the contract.

(i) admitted that the contract contained the warranties set out in section 8 of the Domestic Building Contracts Act 1995;

(j) in the amended paragraph 9 in the Amended Defence dated 29 November 2023, it pleaded to the Stanleys' alleged warranty that the Building Works and materials "would be reasonably fit for any purpose which the [Stanleys] wished to achieve, or would be of such a nature and quality that they might reasonably be expected to achieve the result that the [Stanleys] wished to achieve", by pleading that "the warranty alleged is only given if the contract states the particular purpose for which the work was required". Then in paragraph 17 it pleaded that the Caravan Requirement was not part of the contract, was not mentioned in the contract, and that the contract did not state the particular purpose for which any building work was required, with the result that there was no breach of warranty in respect of the Caravan Requirement;

(k) admitted having performed the building works between 11 September 2018 and 9 May 2019, but did not admit that the Stanleys tried to manoeuvre the caravan into the garage on 17 May 2019. However, EWH admitted its receipt and the contents of the Stanleys' email of 18 May 2019. EWH admitted that the Stanleys moved into the dwelling on 1 June 2019 before the driveway was completed;

(l) did not admit that on 7 July 2019 the Stanleys concluded that the Caravan Requirement had not been incorporated into the building works; and

(m) denied having, on 9 July 2019, confirmed that the Caravan Requirement was part of the Building Contract via its incorporation in the relevant plans, designs and specifications. EWH relied on the contents of its email to the Stanleys dated 9 July 2019.

1. In paragraphs 17 and 18 of its original Defence dated 9 December 2022 EWH had basically denied that the Stanleys had suffered loss or damage. However, in paragraph 17 of the Amended Defence dated 29 November 2023 EWH replaced it with a pleading that said:

(a) it admitted that the Stanleys had suffered loss and damage of $11,612,00, being the extent to which that its expert Mr Edwards agreed - in his report dated 28 October 2021 - with breaches identified by the Stanleys' expert Mr O'Dowd; and

(b) it admitted that the Stanleys had suffered loss and damage of $1,522.00, to the extent that its expert Mr Edwards agreed - in his report dated 17 February 2022 - with breaches identified by the Stanleys' plumbing expert Mr Newell.

1. EWH added, in its amended paragraph 18, that rectification work which would only address technical non-conformity with the contract, would be unreasonable and disproportionate, clearly alluding to the principles enunciated in Bellgrove v Eldridge.
2. EWH also retained its pleading (re-numbered to become a sub paragraph of its amended paragraph 18) that the Stanleys caused their own loss, by failing to provide to EWH any measurements of the caravan they owned in 2018, or photographs or other documentation; and also because they have replaced that caravan. In their opening submissions the Stanleys characterised this pleading as a misconceived allegation of contributory negligence (ie, misconceived because negligence had not been alleged), but perhaps it is directed to the issue of causation. EWH's allegation that the Stanleys have purchased another, new caravan, which renders the allegation of the Caravan Requirement otiose, implies that if the new caravan does not cope with the driveway, the Stanleys have selected the wrong caravan. I note here in the opening submissions the Stanleys said that the new caravan - a Paramount Thunder 186 - had a greater clearance at the bottom but still did not get into the garage,[19] and that EWH submitted that the new caravan is too tall.

The evidence regarding the Caravan Requirement

1. Mr John Stanley made a written Witness Statement dated 22 June 2023 which he adopted as his evidence in chief. The Statement sets out convincingly his history as a caravan enthusiast and his view of the importance of caravaning to the Stanleys' well being and mental health; the practical difficulties of storing the Stanleys' old caravan in their previous house, and his concerns that storing the caravan would become more difficult as the Stanleys aged. He said that in 2013 the Stanleys purchased a custom-built Atlantic pop top caravan, and that they decided to build a new home around their beloved caravan.
2. Now, it must be said here that as a matter of contract law, a party's subjective desires and beliefs are not determinative of how a contract is to be construed. The principles of objectivity take precedence over parties' subjective motivations. However, when the issue is whether a contract contained a provision, as distinct from how a provision is to be construed, evidence of the parties' communications and their motivations is relevant and admissible.
3. Mr Stanley said that the applicants had "extreme difficulty" finding the right block of land for their needs, as they wanted a block on a "consistent plane with the road to avoid any rise and fall of driveway" due to their desire to store the caravan at home. When they first saw the block of land which they eventually purchased, one of the main attractions was that it was level with the road. They signed a contract to buy that block of land on 19 February 2017, and settled the purchase in November 2017. Photographs of the land appear at Tribunal Book pages 395-401, and they show the land to appear - to the naked eye - to be generally flat.
4. Mr Stanley said the applicants inspected many display homes between 2013 and 2017.
5. Paragraphs 22 - 24 of the Statement, concerning the Stanleys' engagement of EWH, essentially mirror the Points of Claim regarding the Caravan Requirement. At paragraph 25, Mr Stanley said that the applicants were confident that by 10 March 2018 they had made clear to EWH the importance of the Caravan Requirement, and that EWH had understood. He said that the Stanleys understood their payment of $2,000.00 on 11 March 2018 was for EWH to prepare designs, plans, specifications and contracts which incorporated compliance with the Caravan Requirement.
6. Mr Stanley said the applicants met with Noel Clifford of EWH on 27 June 2018, well after signing the contract on 3 June 2018, to discuss issues or expectations. At paragraphs 29 and 30 of the Statement Mr Stanley said that he raised the issue of the Caravan Requirement in this meeting, and that he said to Noel Clifford that the applicants wanted the home designed and built around their Atlantic pop top caravan. Noel Clifford replied that he also owned and enjoyed a caravan. The Stanleys told Noel Clifford the difficult process that they faced in getting the Atlantic caravan in and out of their old property, and that Noel Clifford said words to the effect, "I will have to look into that".

1. Mrs Rosina Stanley made a written Witness Statement dated 23 June 2023, but in the context of this issue of whether the Caravan Requirement was part of the contract she only said that she agreed with and adopted the relevant paragraphs of Mr Stanley's Witness Statement dated 22 June 2023.

1. Mr Domenic Cugliari made a written Witness Statement dated 24 March 2023 which he adopted as his evidence in chief. He said that he was a sales consultant of homes and worked for EWH selling homes from its display homes. He said that he had a number of meetings and discussions with the Stanleys over seven months, but did not give details of their contents. He said that during the discussions the Stanleys mentioned they had a caravan and that they would like the garage to accommodate it. He said that as a result EWH included that the garage door would be higher and wider than normal but still within a standard product range. The standard range for garage double doors is 4.8 m wide and 2.1 m high, and these dimensions were increased to 5.1 m wide and 2.4 m high. He said that in preparing the specification the height of the front opening was stated at 2.35 m, to cater for the door's tracks and lifting mechanism. Accommodating the caravan and being able to go through the garage was just "one of many issues" raised by the Stanleys. Before signing the building contract on 3 June 2018 the Stanleys made changes to the ensuite, the bathroom and the electrical plan but did not mention the garage. In paragraph 4 of his Witness Statement Mr Cugliari said that he received Mr Stanley's email of 10 March 2018 responding to EWH's quotation and raising an issue about the levels of the driveway and the openings for the front and rear garage doors. Mr Cugliari replied to that email. He wrote in paragraph 4, "In relation to the rise or fall from the level of the footpath I noted that we would need to wait until the site survey and soil test was done. When this information was obtained it was put on the plans and I did not receive any further queries from the applicants about that issue".
2. The survey[20] referred to is dated 30 April 2018.
3. Mr Cugliari also gave some brief evidence in chief, orally, when verifying his written Witness Statement. He said that he is a sales consultant for several builders. His practice is not to sit with a prospective client for hours reviewing a proposed contract with them, but instead to send the client away with a copy to review and for them to come up with questions to be discussed later. He does not rush the clients. He tells them to take the contract document pack home, read over it and "If you had a bad day at work, don't look at it. When you're ready, write all your questions on a yellow post-it note, stick it on the relevant page, and then when you're ready, come in and we'll go through your questions. At the end of that meeting, if you're happy, we can sign".
4. Mr Cugliari said he has acted this way for basically the whole of his 26-year sales career. This way, he is only answering the questions that the client asks, as distinct from going through every page or every specific item on the contract raising his own issues.
5. As I said, the Stanleys have not pleaded any claim under the Australian Consumer Law (Victoria). Mr Cugliari describes a situation in which EWH proffered a detailed contract pack containing terms and conditions, and building industry jargon and concepts with which the Stanleys were unfamiliar, and put the onus on them to raise issues.

1. Mr Cugliari was cross examined at considerable length. He said that he was familiar with developers' "layout plans" which show the positions of proposed subdivided blocks within broad acres before the land has been subdivided. Mr Cugliari calls them "engineering plans" because they show the fall of the land, the position of any fill on a block of land, and easements. The layout plans in respect of the Stanleys' block did not show incremental rises and falls along the whole block. It only showed the levels at the four corners of the block.
2. Mr Cugliari said the layout plans show the "projected", or "potential", FTs (existing surface levels) and the FSs (finished surface levels) of the broad acres within which the Stanleys' block is situated[21]. They are only "projected" because the developer could change them before the Certificates of Title were issued in relation to the subdivided blocks. The stated FTs and FSs were a guide of what the land developer was saying it was going to produce when subdividing. Similarly, the developer could change the size of the blocks and position of services before the Certificates of Title were issued.
3. Mr Cugliari said that in his discussion with the Stanleys at the display home, they discussed building a custom-made home, rather than following the display home. All the display homes had waffle slabs, but the Stanleys wanted a raft slab. In his experience, older clients prefer raft slabs to waffle slabs, even though they have the potential of using more concrete and therefore being more expensive. EWH's quotation to the Stanleys included an "allowance" for concrete, as a result. Once it was noted that the Stanleys wanted a raft slab, that was agreed and the quote which Mr Cagliari prepared was based on there being a raft slab.
4. Mr Cugliari recalled having discussed caravans with the Stanleys, initially in relation to the heights of the garage door openings, and also in relation to their desire to have a minimum rise and fall in the driveway. Mr Cugliari told them that the rise or fall of the driveway in their new home would be similar to that in the display home, of no more than 300 to 350 mm, with the Stanleys' driveway being on the right-hand side of the block. Mr Cugliari recalled having this discussion in February 2018, and having the Stanleys' sketch of their proposed new house before he prepared the first quotation.[22] It is clear that Mr Cugliari was conveying that the fall of the driveway, from the front boundary to the garage slab, would be no more than 300 to 350 mm. He was not saying that the fall would be up to 300 to 350 mm 'per metre'.
5. Pages 407 and 408 in the Tribunal Book are two different "informal sketches" of floorplans of the proposed house: one clean and one marked up, both dated 28 August 2017. Both were prepared by Mr Stanley on a computer. Mr Stanley sought to copy much of the design of the Stanleys' old house. In paragraph 23 of his Witness Statement dated 22 June 2023 Mr Stanley calls each of these documents an "informal sketch" which he had given to Mr Cugliari. The two documents were not identical before the handwritten alterations were made on the second sketch.[23] Both of them, though, show the garage on the left-hand side of the house. Mr Cugliari said that he made the handwritten alterations on the second plan.
6. Mr Cugliari said that whether the driveway was on the right or left side of the house was irrelevant to the amount of the quote, and that it was up to the Stanleys to obtain confirmation from the developer that it would allow the Stanleys to have the driveway on the left-hand side of their house. It was also up to the Stanleys to give Mr Cugliari their copy of the developer's design guidelines and a plan of subdivision and engineering.
7. In cross examination Mr Cugliari said that he could not recall having told the Stanleys that the fall of their driveway would be around 350 mm, comparable to that in the display home. This was contrary to his evidence in chief. He asserted that if he had said such a thing it would have been based on the layout plans that he had received from the developer, as it could not have been based on anything else. It would not have been based on the driveway being on the right-hand side. [Clearly, this evidence contradicts Mr Cugliari's other oral evidence, that he told the applicants that the driveway in their new home would be similar to that in the display home, with a fall of no more than 300 to 350 mm].
8. Mr Cugliari also said that he had the development engineering document when, at the display home, he told the Stanleys that the fall of the driveway in their proposed new home would be no more than 300 to 350 mm, but he did not say that he could only guarantee that if the driveway was put on the left side of the house.[24] He emphasised that he had the sketch for the purposes of preparing a quote, which would itself be discussed and refined. He said that clients often got their informal sketches wrong. In substance Mr Cugliari was saying that the focus of the discussion was that a quote would be prepared: the focus was not the fall of the driveway or even its position on the left or right side of the house. Mr Cugliari said it was incumbent on the Stanleys to get confirmation that the developer would approve the driveway being put on the left side of the house, because that would involve moving the crossover and potentially the position of a streetlight or a drain.
9. Ultimately in his cross examination Mr Cugliari said that he could not recall the discussion with the Stanleys. He said that he would only have been able to say to the Stanleys that the fall of the driveway in the proposed new home would be no more than 300 to 350 mm if he had the developer's engineering document.
10. Mr Cugliari prepared a quotation, headed "Preliminary Building Agreement" dated 10 March 2018.[25] It quotes a price of $316,245.00 and sets out a list of features and inclusions. It included, "Portico and alfresco slab poured as part of the foundations", which is important to some of the plumbing defects asserted by the Stanleys. It reinforces the point that EWH was not contracting to construct other paving.
11. Mr Cugliari was taken to an email that he had sent to Mr Stanley at 5:25pm on 10 March 2018.[26] It contains the text of Mr Stanley's email in black print, and Mr Cugliari's replies in blue. Mr Stanley's email had said, "'Please note: Our concern is there needs to be a minimal rise or fall from the level of the footpath due to moving the caravan into and out of the garage. 1. Can this request be emphasised to the Design Engineers?"
12. Mr Cugliari's reply was, "This is a tuff (sic) one, not to say it will not be the way you want but until we get the Site survey and soil test done to the draftsman to punch it all into the computer it's hard to determine exactly. Looking at your engineering again which I have attached a diagram with the measurements the Block falls slightly from Front to back. From the footpath to the toe and batter it falls 370 mm on the left side then from batter to rear of block another 170 mm. We will scrape a certain amount of soil away and also Raft slabs are approx 90 mm lower than Waffles. Right side ( Garage side) from Footpath to the batter where your garage will be approx it falls 320mm then another 180 mm to the rear of the block. Basically we will go over this and discuss it once we have all in front of us".
13. Mr Cugliari was asked about the relationship between the Preliminary Building Agreement of 10 March 2018 and the above email of 5:25pm on 10 March 2018. Mr Cugliari said you would get a site survey carried out, and engineering drawings and soil testing engineering after the Certificate of Title had been issued for the Stanleys' block. Mr Cugliari said that as at 10 March 2018 he only had drawings showing the garage on the left side of the house.[27]
14. Mr Cugliari identified the Detail and Contour Survey of the Stanleys' block, prepared by Structeer Surveying and dated 3 May 2018,[28] which he said gave the draftsperson, and possibly the engineers, enough information to determine rises and falls of the driveway. He said that this Survey was the document that he was foreshadowing in his email to Mr Stanley of 5:25pm on 10 March 2018.
15. Mr Cugliari said that he did not give the Stanleys a copy of the Survey. Mr Cugliari conceded that, contrary to what he had said to the Stanleys in his email of 5:25pm on 10 March 2018, they did not "go over" the Stanleys' stated concern that there needed to be a minimal rise or fall from the level of the footpath due to moving the caravan into and out of the garage "once we have (the Site survey and soil test) in front of us", and that in the absence of the Survey the Stanleys were not in a position to raise the topic with Mr Cugliari again.[29] Indeed Mr Cugliari said that if he was to have further discussions with the Stanleys and they brought up, for example, moving garden taps and installing stone benchtops but without mentioning the rise and fall of the block of land, Mr Cugliari was "not going to bring it up again. I'm moving on. I'm dealing with what's at hand".[30] There is a degree of sharp practice by Mr Cugliari here, given his awareness that the Stanleys were not contracting EWH to build a house matching a display home but rather were contracting for EWH to design and construct a bespoke home.
16. During the hearing EWH handed up to the Tribunal 108 pages of 'preliminary' and 'pre-final' plans, which were added to the Tribunal Book. EWH had not made discovery of these documents in accordance with pre-hearing directions, and the documents were disclosed informally between Counsel. Page 49 of this bundle was the General Notes of a Drawing called 'Drawing No: Pre-Final 12/06/18". Page 50 showed the proposed dwelling on the block, overlaid on the contours of the block. The garage is shown on the left side of the house. Mr Cugliari said in cross examination that the drawing on page 50 was the first to record "RL 10" (which he said meant "relative level 10", a different expression to "reduced level" used by Mr O'Dowd though apparently having the same meaning). The drawing shows the levels of the left boundary of the block, going from 9.98 at the front boundary, to 9.49 at the rear of the house and 9.08 at the back boundary.
17. The Stanleys replied to Mr Cugliari's email of 5:25pm on 10 March 2018.[31] They asked whether Mr Cugliari could obtain a copy of the amended engineering drawings showing the driveway and garage on "the correct side of the block", meaning the left side. Mr Cugliari replied at 12:20pm on 11 March 2018, not addressing the change in the location of the driveway and so not addressing the fall in the driveway, but instead advising that the façade of the house was a Prime Cost item as it had "never (been) really confirmed" and that if the Stanleys "like something" (ie, a particular façade) he could get it drawn up and costed for approval. Nothing in this email would suggest to the Stanleys that moving the garage had any effect on the fall of the driveway.
18. Mr Cugliari admitted that he "should have then said, 'By the way, we need to re-look at this [meaning changing the location of the driveway] because this does change - it could change the orientation of the block, it could change energy ratings, it could change a lot of things'".[32] Mr Cugliari said that he "would have" told EWH about the change in the location of the driveway and its potential effect on the fall of the driveway, but he was unable to point to or recall specific communications to that effect. He also said that once a building contract is signed, he drops out of the picture and the clients are to deal directly with EWH.
19. Mr Cugliari conceded that at the time the contract was executed on 3 June 2018, no FFLs on any drawings had been provided to him or to the Stanleys, and that once the FFLs had been identified, he did not review them.
20. Mr Cugliari said that he had no knowledge of whether the site cut was 130 mm too deep during the building works.

1. When re-examined, Mr Cugliari said that the Stanleys never showed him a photo of their caravan, or gave him dimensions of the caravan such as its length, width or height. The Stanleys did not contact Mr Cugliari after the email exchange on 10 and 11 March 2018.

1. Mr Stanley made another written Witness Statement on 3 November 2023, replying to Mr Cugliari's Witness Statement. He said that on each occasion during the approximately seven discussions with Mr Cugliari, "the Caravan Requirement was always a key topic of discussion". He said that in the second or third meeting with Mr Cugliari, he explained that when he referred to the "fall" of a driveway, he meant the gradient of the driveway, because he was conscious that the driveway at the display home fell in the opposite direction to the new property. [I assume Mr Stanley meant that at least one of the display homes was built on land which was higher than the road, and that its driveway rose rather than fell]. Mr Stanley said to Mr Cugliari that the applicants wanted the gradient of the driveway in their new home to be the same as the minimum fall of the driveways of the display homes (plural), and Mr Cugliari replied to the effect that the home being designed for them would have a fall of no more than 300 to 350 mm which was comparable to the driveways in the display homes.
2. Mr Stanley said that in the fourth or fifth meeting with Mr Cugliari, Mr Stanley described the process the applicants had to go through moving the caravan in their old property and informed him about how a minimal fall of the driveway in the proposed new home would work with the wider and higher front and rear garage doors.
3. Mr Stanley said that EWH applied for the relevant building permit, and provided the relevant site classification report, structural computations, engineering designs, drainage designs, final building plans and others to the person who issued the permit. The Stanleys were not in any way involved in or given copies of the engineering designs, drainage plans or structural computations. Mr Stanley assumed that the Caravan Requirement was embodied in the contract, plans and designs.
4. In cross examination Mr Stanley conceded that the block of land was lower than the footpath, and that the footpath and crossover had not been built when they bought the land. He considered the block to be level with the road. He recognises that the land of the houses behind the Stanleys' new house is lower that the Stanleys' land. He also recognises that the Stanleys' land is slightly higher on the left side - the north - and has a subtle slope down to the right.
5. Mr Stanley said that he saw that the land was reasonably flat, and did not make any enquiries of the developer as to whether the land would be suitable for a caravan.
6. Mr Stanley conceded that the informal sketches he made and gave to Mr Cugliari, sales agent for EWH, did not mention the Caravan Requirement. He said, though, that he gave Mr Cugliari the dimensions of the applicants' caravan.
7. Counsel for EWH put to Mr Stanley that the front right corner of the block was 46 cm lower than the front left corner, and Mr Stanley agreed. Similarly, Mr Stanley agreed with the proposition that anything said by Mr Cagliari to the effect that the fall of the driveway would be 300 to 350 mm was based on the Stanleys' erroneous information that the garage would be on the right side of the house. It was suggested that put together with Mr Cagliari having said in his email of 10 March 2018 that raft slabs are approximately 90 mm lower than waffle slabs, that the Stanleys' decision to move the driveway to the left side of the house caused there to be a bigger fall of the driveway. Mr Stanley said that he did not have the expertise to reply - that he wouldn't have known and that he is not a draftsperson.
8. Mr Stanley acknowledged that EWH's document headed 'Preliminary Building Agreement' dated 10 March 2018 was a quote.[33] It mentions the driveway being coloured, and the dimensions of the garage doors, but does not mention the fall of the driveway. Another Preliminary Building Agreement dated 24 May 2018[34] does not mention the fall of the driveway. Mr Stanley acknowledged that it came with a page headed 'Notes and Acceptance' which he read and which the Stanleys signed.[35]
9. In my view, clauses 11 and 14 of this document are an attempt at an 'entire agreement' clause. Clause 11 says the client "acknowledges that all discussions with [Mr Cugliari] that are not on the Preliminary building agreement and have not been confirmed and decided by the client are NOT included. Unless made in the notation section of the Preliminary Building agreement or in writing in the Preliminary Building agreement. All non standard requests are at the discretion on (EWH)". Clause 14 says the client "acknowledges that they have read this quotation thoroughly and have had ample time to go over it and make all necessary changes and additions they have wanted and spoken to and there dealings with an Orions Homes sales representative (sic). Clients acknowlede thal (sic) there are items in the display home (sic) thal (sic) are for display purposes only. They are but not limited to landscaping, blinds/curtains, light filings (sic), extra electrical above the standard plan (sic), fealure tes (sic), feature floor coverings and ather (sic) decor items. The client has only chosen the items listed in the Preliminary building agreement".
10. This point was not addressed in the Stanleys' written submissions. Plainly though it would be very difficult to read either clause 11 or 14 literally. Clause 11 cannot benefit EWH: the phrase, "are not on the Preliminary building agreement and have not been confirmed and decided by the client" (emphasis added) is inapplicable on its terms because the Caravan Requirement was not on the Preliminary building agreement but it had been confirmed and decided by the Stanleys, as communicated by them to Mr Cugliari on multiple occasions. The Preliminary Building Agreement dated 24 May 2018 does not even mention the raft slab or the façade, and it includes the phrase "All Other Orion Homes Deluxe List of Inclusions $INC" which seems to mean that they are included but without saying what they are. Clause 14 is so poorly expressed as to be meaningless. It cannot be relied on by EWH to escape its obligation to satisfy the Caravan Requirement.
11. I cannot accept Mr Cugliari's evidence of conversations with Mr Stanley, when it is inconsistent with Mr Stanley's evidence. Mr Cugliari contradicted himself in a number of important respects, and explained that he had engaged in many transactions since these events in 2018. His evidence of what he "would have" done is a reconstruction, probably done in good faith but based on a version of logic rather than a clear recollection of facts.

James Clifford, director of EWH- evidence in chief

1. James Clifford, a director of EWH, made a written Witness Statement dated 24 March 2023 in which he briefly described his discussions with Mr Cugliari "during the sales process". The Statement merely sets out a hearsay account of Mr Cugliari's discussions with Mr Stanley, followed by an assertion of James Clifford's purported legal conclusion that "no commitment either implied or contractual was made in relation to levels or rise and fall of the driveway". James Clifford's Statement contains mere assertions rather than evidence and I disregard it.

Noel Clifford, director of EWH- evidence in chief

1. Noel Clifford, a director of EWH, made a written Witness Statement dated 24 March 2023 which he adopted as his evidence in chief. In the Statement he said that he first met the Stanleys on 27 June 2018, at a pre-construction meeting to discuss the project. This was after the contract had been signed. Noel Clifford said the applicants mentioned the difficulties they had in their old home with the garage access heights in relation to the caravan, and this led to confirmation as per the contract and specifications to achieve a clearance height of 2350 mm, but there was no mention at that meeting of the driveway. The rest of the Statement deals with events after 7 July 2019, when the Stanleys wrote to EWH saying that they could not get their existing caravan through the garage.
2. I consider Noel Clifford's evidence to be implausible. It makes no sense for the Stanleys to have mentioned the difficulties they had in their old home with the garage access heights in relation to the caravan, after all of the Stanleys' communications with Mr Cugliari, but then to make no mention of the driveway. I do not believe Noel Clifford's evidence. I think that with the passage of time, Noel Clifford's recollection has become unreliable. On the other hand, the Caravan Requirement was important to Mr Stanley and it is more likely than not that he would recall conversations about that matter more accurately than would Noel Clifford.

Evidence of the Caravan Requirement not being satisfied

1. There are videos of attempts being made to reverse the caravan down the driveway and into the garage. The caravan in this video is the Stanleys' new caravan, the Paramount Thunder 186, which Mrs Stanley said they purchased in December 2019. The best video is one of 5 minutes 23 seconds' duration which is labelled "00288 van second attempt" in the Tribunal's "case management system". It depicts Mr Stanley and one of the Cliffords standing on the driveway while a person reverses the caravan into the garage. Relevantly:

(a) the driver takes about 5 minutes to painstakingly reverse the caravan at extremely slow speeds, using the utmost skill and caution. Five minutes is an excruciatingly long period of time in this context. I'd ask the reader to reflect on how many times it has taken them 5 minutes to reverse into the driveway of a suburban house;

(b) the vehicle's wheels have been put on boards, when the vehicle is on the cross over, to raise the vehicle's height and thereby increase the angle where the vehicle's towball meets the caravan's hitch, to reduce the prospect of the underside of the caravan striking the footpath;

(c) even with the wheels of the vehicle having been raised by these boards, when the caravan is going over the footpath, once the caravan's wheels have got onto the driveway the distance between the underside of the caravan and the surface of the footpath is a matter of a few centimetres, around the size of a matchbox;

(d) the caravan's wheels have been put on boards, when they are on the driveway, to increase the distance between the bottom of the caravan and the surface of the driveway;

(e) unintentionally, the person who took the video occasionally points the camera down the driveway of the house next door, showing it to be basically level with that property's garage, in a vivid contradistinction with the slope of the Stanleys' driveway as it approaches the Stanleys' garage;

(f) as the driver slowly and carefully reverses the caravan, he or she is told to "Stop!" on several occasions, as persons outside the caravan move the boards or check that the bottom of the caravan is not scraping on the footpath or (it appears) that the top of the caravan is not striking the garage;

(g) as a testament to the skill of the driver and the great care which was exercised, the caravan does not scrape on any surface of paving in this video. However, I have no hesitation in finding that a driver of average skills with experience in towing a caravan, would not be able to perform this task. It becomes a word game: you cannot say that it is "possible" for a person to swim the English Chanel because elite athletes can do so after a lifetime's training. Even though this video shows the caravan - on this occasion - being reversed towards the garage without being damaged, I am comfortable with saying that it is practically impossible for an average driver to achieve that result, with or without outside assistance of people moving boards and periodically telling the driver to "Stop!".

Mrs Stanley gave evidence that when the Stanleys went looking for a new caravan, they sought a caravan which could cope with the driveway. She said that they asked the supplier to deliver the caravan and reverse it into the driveway, but that the supplier was unable to succeed in doing so. As the supplier attempted to reverse the caravan, the hitch - which is the component which attaches the caravan to the vehicle - could not cope with the change of angles; the caravan would not go down the driveway because it was too steep; and the vehicle's wheels began to spin as if the driver was doing a "burn out". Mrs Stanley considered the exercise to be very dangerous.

1. Mrs Stanley said the Stanleys had the caravan modified, by taking the battery box off the bottom and removing the antenna from its roof. The latter would have addressed any problem of the caravan being too tall for the garage opening because of the angle of the driveway, but relevantly, even removing the battery box did not enable the caravan to go down the driveway.
2. I find that EWH did not satisfy the Caravan Requirement. It is practically impossible for a competent average driver, experienced in towing and manoeuvring caravans, to reverse the Stanleys' caravan into and through the garage.

1. Even though the pleadings mention the expression "implied term", the first and sixth bullet points of clause 11 of the parties' major domestic building contract dated 3 June 2018 set out express warranties by EWH that:

the Building Works will be carried out in a proper and workmanlike manner and in accordance with the plans and specifications set out in this Contract; (and)

if this Contract states the particular purpose for which the Building Works are required, or the result of which the Owner wishes the Building Works to achieve, so as to show that the Owner relies on the Builder's skill and judgement, the Building Works and any material used to carry out the Building Works will be reasonably fit for that purpose or will be of such a nature and quality that they might reasonably be expected to achieve that result".

1. The plans and specifications deal with the FFL, and I will return to that matter. If EWH constructs the house in a way which is not in accordance with the plans and specifications set out in the contract, it breaches the contract.
2. The evidence which I have set out above in relation to the Caravan Requirement establishes that the Stanleys stated to Mr Cugliari, agent for EWH:

(a) that the particular purpose for which the Building Works were required included enabling the Stanleys' caravan to be reversed down the driveway and through the garage, which entailed EWH building a driveway with a suitably small fall;

(b) that the result which the Stanleys wished the Building Works to achieve, was not only to create a house to live in, but significantly was also to allow the Stanleys' caravan to be reversed down the driveway and through the garage, which entailed EWH building a driveway with a suitably small fall in levels, in a way which showed that the Stanleys relied on EWH's skill and judgment; and

(c) that the Building Works and any material used to carry out the Building Works were to be reasonably fit for those purposes, including the Caravan Requirement, or would be of such a nature and quality that they might reasonably be expected to achieve that result.

1. Accordingly, I am satisfied that it was an express term of the building contract that the house would be constructed in such a way that it would enable the Stanleys' caravan to be reversed down the driveway and through the garage. Obviously, the term meant that the caravan could be reversed down the driveway without being scraped and damaged in the process, and without having to be driven by an expert in an extraordinarily skilled way using special equipment.
2. The written building contract does not set out all terms to the exclusion of all other communications. I am satisfied that the Stanleys' discussions with Mr Cugliari had the effect of including the Caravan Requirement as an express term of the contract.
3. If one were to approach the issue as a question of whether the Caravan Requirement was an implied term of the contract, you would turn to the test set out in Liverpool City Council v Irwin[36] which deals with the implication of terms in law based on the imputed intention of all parties to a class of contract. The facts of that case would be most unlikely to arise in Victoria now because residential tenancies are so highly regulated by the Residential Tenancies Act 1997 (Vic). But the general principle stated by the House of Lords was that an obligation of a landlord of a high rise apartment building to maintain common areas necessary to enable the tenants to enjoy their individual apartments (including lifts and rubbish chutes) should be implied in the contract because "the nature of the contract itself implicitly requires no more (and) no less: a test in other words of necessity". The House of Lords referred to another case involving a residential apartment building, where the Cout said it was "obvious" that the landlord was obliged to maintain the stairs and keep them reasonably safe to the tenants and visitors.
4. In my view the Stanleys would not establish the Caravan Requirement as an implied term under Liverpool City Council v Irwin. A term that a builder must build a house which is watertight would be suitably 'necessary' but the Caravan Requirement would not be.
5. The case of BP Refinery (Westernport) Pty Ltd v Hastings Shire Council[37] which deals with the implication of terms in fact based on the need for efficacy of a particular contract, would not be relevant to the Stanleys. In BP Refinery the High Court said that five conditions (which may overlap) had to be satisfied before a term would be implied: it must be reasonable and equitable; it must be necessary to give business efficacy to the contract, so that no term will be implied if the contract is effective without it; it must be so obvious that "it goes without saying"; it must be capable of clear expression; and it must not contradict any express term of the contract.
6. The facts in BP Refinery bear no resemblance to this building dispute. The company had two contracts with State and Local governments, which had the effect of subsidising the construction and operation of an oil refinery. The contract with the State said BP could assign rights and liabilities, but the contract with the Locality did not. BP underwent a corporate restructure, and wanted to assign rights and liabilities under the contract with the Locality. The Privy Council implied a term in BP's contract with the Locality to the effect that BP could assign rights to another company in the same group.
7. I do not consider BP Refinery to be relevant to the Stanleys. If it was, there would be questions around whether the Caravan Requirement was necessary or obvious.
8. However, as I say above, that EWH would satisfy the Stanley's Caravan Requirement was an express obligation under the contract.
9. As I have set out above, some attempt was made by EWH to defend this part of the case on the basis that the Stanleys had not given EWH the specifications or dimensions of their 2013 Atlantic pop top caravan. I am not persuaded by EWH's argument. EWH did not ask the Stanleys for the specifications or dimensions. Obviously there is a wide range of caravans on the Australian market but there is no suggestion in any of the evidence that the Atlantic was of excessive dimensions - like a Hummer in a sea of Fiat 500s - and Mr Stanley's evidence of how he became a caravan enthusiast, his employment history and retirement (which suggests that he would not have the financial resources to afford a monster caravan) and the Stanleys' ages satisfy me that the Atlantic was a caravan of average dimensions which had been stored in the Stanleys' old house (albeit with some inconvenience, which the Stanleys wanted to overcome by way of the Caravan Requirement) and which would not surprise other road users. There was also evidence that Noel Clifford said that he had owned a caravan, without him going on to ask for dimensions. In my view there is no room for EWH to argue that the Stanleys created the problem because the Atlantic was relevantly abnormal.
10. I find that EWH breached the contract because it did not satisfy the Caravan Requirement.

1. The finished floor levels are related to the Caravan Requirement, but are a separate issue in this case because of the need to assess damages for breach. They are related because, by building the house and garage with FFLs which were 130 mm lower than they should have been, EWH constructed the driveway with a gradient which was greater than it should have been.
2. By the end of the hearing EWH conceded that it built the house outside of the tolerance of the FFL and/or that the driveway, as a natural consequence of the FFL issue, was built to a different gradient than as shown on the plans that specified a line for the driveway.[38] EWH conceded that the FFL of the garage slab is 130 mm below the designed level. The fall of the driveway between the electricity pit at the north west corner of the block and the garage floor is 130 mm more than designed.
3. Clause 11 of the building contract[39] sets out EWH's warranty to the Stanleys that its building works would be carried out in a proper and workmanlike manner in accordance with the Plans and Specifications set out in the contract. Clause 1 defines Plans to mean "the drawings showing the layout and design details of the Building Works with dimensions and elevations, including the Engineer's Design".
4. The first version of the building plans[40] depicted, on sheets 4 and 5, the West, North, East and South elevations of the house. They showed a flat driveway, level with the electricity pit, leading into the garage. They did not show any fall in the land from the footpath, or any fall in the driveway from the footpath to the front of the garage. They did not depict any site cut.
5. Mr Cugliari sent the Stanleys the second version of the building plans on 21 May 2018. That version of the plans[41] was signed by the parties and are the contract plans. They do not show any fall in the land. They show a flat driveway, level with the electricity pit, leading into the garage.
6. Mr Cugliari had sent the Stanleys a copy of the site survey on 8 May 2018, which at paragraph 3.1 said, "Site Description At the time of site visit the site slope was generally flat to slight, and drainage was found to be poor to moderate".[42]
7. As I mentioned in paragraph 80(e), discussing the video of an attempt to reverse the caravan into the garage, the property to the north of the Stanleys has a driveway which is almost level with the footpath, and leads into the garage without any slope.
8. Fifteen days after the contract was signed EWH caused a third version of the building plans to be produced, but it did not disclose those plans to the Stanleys. These plans[43] showed the FFL of the garage at 9.49, lower than the RL datum of 10.00 at the north west corner of the block,[44] and the elevations on page 4 showed a fall in the land from the footpath down to the garage. It also showed that a retaining wall was required to be built on the boundary, next to the garage, "to Engineer's design", and that at a point behind the garage the site was to be cut to RL 9.30.
9. Six days later, EWH caused a fourth version of the building plans to be produced,[45] without consulting the Stanleys or disclosing this new version to them. This version omitted the retaining wall, but continued to show the site cut to a point behind the garage to RL 9.30.[46] This version was superseded by a "Final" version, on 10 July 2018, with the same contents as to the levels, the driveway and the absence of a retaining wall. Again, EWH did not consult the Stanleys about the creation of this plan or advise them that it existed.
10. Two more versions of the building plans were created after this "Final" plan: a "Revised Final" plan on 19 July 2018 and an "updated" final version dated 10 September 2018, the latter being the version in respect of which the Building Permit was issued.[47] In this version of the plan, the FFL of the garage is shown even lower, as 9.46. It was a condition of the building permit that the permit was to be read in conjunction with the endorsed drawings, which included that last, updated final plan.
11. The Stanleys called Mr Tom O'Dowd of Victorian Building Consultants Pty Ltd as an expert. In his report dated 29 November 2021[48] Mr O'Dowd stated that, using appropriate laser measuring equipment, he observed the centre of the garage slab to have a height value of 9.33 (compared to the RL 10.00 at the electricity pit) which meant that it was 670 mm below the top of the electricity pit. This was 130 mm lower that required by the Building Permit and the updated final plan.
12. EWH called Mr Glenn Edwards as an expert. During the hearing he abandoned an opinion that the Drainage Plans, which post-dated the Building Permit plans, identified the correct FFLs and he conceded that the Building Permit plans prevailed. He conceded that the FFL of the garage slab as constructed was 130 mm lower than required by the Building Permit and the updated final plan.
13. Mr O'Dowd and Mr Edwards agree that the driveway has been built with an average fall of 123 mm over every metre, amounting to approximately 12% of fall.
14. Similarly, Mr Edwards and EWH conceded the FFL of the house slab was 130 mm lower than required.
15. Where the parties differ in relation to the FFLs is that the Stanleys submit that EWH has committed a significant breach of contract which has caused them substantial damages, because of the relationship between the FFL and EWH's failure to satisfy the Caravan Requirement, whereas EWH submits that absent the Caravan Requirement this breach in relation to the FFLs has not caused compensable loss. That is, it is a principle of contract law that a party only obtains damages for breach of contract if the breach has caused loss and damage. EWH argues that if its clients under a building contract simply wanted the house to serve as a home, or for example if they did not own a caravan, the fact that the garage slab and house slab were 130 mm lower than required under the contract would be irrelevant: in the written submission of 1 July 2024 on behalf of EWH it is eloquently put that, "The whole caravan aspect of the case ... is clearly a proxy, and an emotive one, to give some other aspect to a technical, but real, but otherwise practically insignificant breach". That is, EWH submits that the Stanleys have not sustained a genuine loss, but are instead attempting to use a technical breach of contract to secure an un-covenanted profit. Put in the language of Bellgrove v Eldridge, that it would be unreasonable to suggest that the house should be demolished and rebuilt because there is no structural deficiency in the house; no suggestion that the lower than contracted for FFL makes the house liable to flooding or the like; and that the driveway itself is not defective, in the sense of being poorly constructed, cracked, or distressed.

DAMAGES IN RELATION TO THE CARAVAN REQUIREMENT AND THE FFLS

(a) by not satisfying the Caravan Requirement, and separately,

(b) by building a house and garage to the wrong FFLs.

1. There is merit in EWH's submission that if it was not a term of the contract that EWH would satisfy the Caravan Requirement, then EWH's breach in building the house and garage to the wrong FFLs would be a technical breach not sounding in substantial damages. However, meeting the Caravan Requirement was an important contractual obligation of EWH. It is not open to EWH to say that homeowners as a class would not have a caravan requirement. The relevant contract is between the Stanleys and EWH.
2. Both sides made submissions about Bellgrove v Eldridge,[49] which is a famous case that is frequently cited in VCAT decisions. I refer to the following passage, which I think illustrates the importance of recognising that this case arises from the Stanleys' contract with EWH, which contained the Caravan Requirement, so that the Stanleys' rights are not considered as if the Stanleys were mere members of a 'class' of builders' clients.
3. The High Court said:

"In the present case, the respondent 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. This loss ... can, prima facie, be measured only by ascertaining the amount required to rectify the defects complained of and so give to her the equivalent of a building of her land which is substantially in accordance with the contract. One or two illustrations are sufficient to show that the prima facie rule for assessing damages for a breach of warranty upon the sale of goods has no application to the present case. Departures from the plans and specifications forming part of a contract for the erection of a building may result in the completion of a building which, whilst differing in some particulars from that contracted for, is no less valuable. For instance, particular rooms in such a building may be finished in one colour instead of quite a different colour as specified. Is the owner in these circumstances without a remedy? In our opinion he is not; he is entitled to the reasonable cost of rectifying the departure or defect so far as that is possible" (emphasis added).[50]

1. The Court then went on to add the qualification that not only must the work undertaken be necessary to produce conformity with the contract, but it must be a reasonable course to adopt. As an illustration of this principle, the High Court said that, "No one would doubt that where pursuant to a building contract calling for the erection of a house with cement rendered external walls of second-hand bricks, the builder has constructed the walls of new bricks of first quality the owner would not be entitled to the cost of demolishing the walls and re-erecting them in second-hand bricks. In such circumstances the work of demolition and re-erection would be quite unreasonable".
2. Applying this reasoning, even recognising that we are talking about the Stanleys and not 'generic owners as a class', and recognising that it was a term of the contract that EWH had to satisfy the Caravan Requirement, demolishing and rebuilding the house to remedy the FFL defect would undoubtedly be unreasonable.
3. But it does not follow that the Stanleys are only entitled to nominal damages. EWH's failure to satisfy the Caravan Requirement has caused the Stanleys to suffer a loss, namely their inability to store their caravan at their home.
4. Whilst the measure of that loss is not the cost of demolishing and rebuilding the house, because doing so would be unreasonable, there is no "one method" of assessing damages for breach of contract, and it cannot be said that damages in building cases must only be assessed by reference to the cost of rectification or demolition and rebuilding. It is no accident that the High Court said, "This loss ... can, prima facie, be measured only by ascertaining the amount required to rectify the defects complained of...".
5. As I noted at the beginning of these Reasons, the Stanleys have retired. They are in their mid 60s. Because they focussed on the cost of rectification or demolition and rebuilding, to the exclusion of all other ways of assessing damages, there is currently no evidence before the Tribunal on the following matters but I have no doubt that they should be considered:

(a) the Stanleys cannot expect to use their caravan "forever". As in personal injury cases in which plaintiffs are compensated for loss of future earning capacity, it is possible to determine a period of time over which a loss will be incurred, and to capitalise it into a lump sum which is discounted to reflect the benefit to the plaintiff of receiving the sum early. Simply as an illustration, it might be said that for 10 years, but no more, the Stanleys could be expected to be using a caravan, so that they will suffer a loss for a maximum of 10 years;

(b) the caravan was not at the Stanleys' house when the view was conducted during the hearing. It must have been stored somewhere. I accept that it cannot simply be parked in the street, because the Stanleys would be penalised by the local Council. The caravan could be stored at a facility, at a cost. I have no doubt that the cost of storing the caravan for even 10 years would not come anywhere near the $650,000.00 asserted cost of demolishing and rebuilding the house. Mitigation of damage would in effect require the Stanleys to be compensated for storage costs, at a reasonable location, rather than for the cost of demolishing and rebuilding the house;

(c) EWH builds display homes, and acquires land for that purpose. Could not EWH lease a block of its land, in a reasonable location, to the Stanleys at a peppercorn rental, so that they could store their caravan there? At the end of the lease, possession would revert to EWH and, if history is a guide, EWH then would enjoy the land's increase in value;

(d) there may be some additional cost incurred by the Stanleys in retrieving their caravan before taking a trip, and returning it to storage afterwards. That could be ascertained;

(e) as the basis of the Stanleys' complaint is that they cannot store their caravan at their home, there does not seem to be any basis for saying that the Stanleys should be compensated for the cost of hiring someone to drive their caravan between the storage facility and their home. If they can drive a vehicle towing a caravan, they can drive the vehicle to and from the storage facility;

(f) the Stanleys may be able to establish an entitlement to damages for loss of amenity, but the parties will be aware that awards of this kind are insubstantial.

1. The Tribunal will hear further evidence from the parties on this aspect of the Stanleys' damages, but it would expect the parties, through their competent and experienced lawyers, to fully explore negotiating an appropriate sum before incurring the expense of a further hearing. It is regrettable that more time will be taken receiving evidence on this point - unless the parties resolve the issue - but as I said it is already necessary to hear evidence on the cost of alternative accommodation and storage.

THE OTHER ALLEGED BUILDING AND PLUMBING DEFECTS

1. On the basis that the house will not be demolished and rebuilt, it is necessary to determine the Stanleys' claims in relation to the other alleged defects, and assess the cost of rectifying them.
2. In paragraph 6 of the written submissions of 11 June 2024 filed on behalf of the Stanleys, and its schedule, there is a summary of the respective views of Messrs O'Dowd and Edwards. Some alleged defects are disputed by EWH as to liability; some are agreed as to liability but are disputed as to quantum; and some are agreed as to both liability and quantum.
3. I note that Mr Edwards does not purport to be an expert in plumbing. I am satisfied that both Messrs O'Dowd and Edwards are experts in relation to the matters on which they gave evidence. The Stanleys vigorously challenged Mr Edwards' evidence and asserted that he was acting as an 'advocate' rather than properly expressing expert opinion evidence as an officer of the court. I reject those attacks. I am satisfied that Mr Edwards did no more that express opinion evidence in good faith. Simply disagreeing with some evidence of Mr O'Dowd does not make him an 'advocate'. Mr Edwards conceded some matters. It is important not to take an overly pedantic view of an expert's expression of their evidence.
4. The costing of alleged defects evolved in the lead up to the hearing:

(a) The Stanleys first obtained an informal report by Mr O'Dowd, which was not relied on in this proceeding. Mr O'Dowd set out two alternatives: demolition and rebuilding, and rectifying specific items.

(b) EWH obtained a report from Mr Edwards in reply,[51] dated 28 October 2021.

(c) The Stanleys then obtained a report by Mr Newell about plumbing issues,[52] dated 31 October 2021. Mr Newell did not provide any costings.

(d) Mr O'Dowd prepared his first formal report[53] dated 29 November 2021, in which he provided costings for his two alternatives.

(e) Mr Edwards then prepared a supplementary report[54] dated 17 February 2022 in which he focussed on items identified by Mr Newell.[55] Mr Edwards opined that EWH was not liable for 8 of the 12 items identified by Mr Newell, and he costed the 4 items for which he considered EWH was liable at $1,522.00.

(f) Mr O'Dowd prepared an updated costing on 21 November 2023.

(g) Mr O'Dowd and Mr Edwards gave evidence in the hearing orally, concurrently.

(h) Speaking generally, both Mr O'Dowd and Mr Edwards would cost an item, and add percentages for contingencies, margin and GST. Mr Edwards does this for each item. However Mr O'Dowd states his costing of the item on one page, and then at the end, globally applies 10% contingencies, 25% margin, and 10% GST to the total of all of the items. For example, in relation to items 2.1, refixing and painting the soffit lining on the entrance portico, on page 15 of Mr O'Dowd's report of 21 November 2023, Mr O'Dowd costs labour and materials at $280.00 + $720.00. (Whilst these two figures equal $1,000.00, Mr O'Dowd does not show that figure; only its components). Then on page 22, he gives the sub-total of his costings of all items, and then adds 10% contingencies to give a sub-total, then adds 25% margin to that sub-total to give a second sub-total, and then adds 10% GST. When the parties then refer to the respective costings of Messrs O'Dowd and Edwards, Mr O'Dowd's figure for item 2.1 is stated at $1,512.50. The calculation (not shown on page 15 but implied from the calculation on page 22) is this: $1,000.00 + $100.00 = $1,100.00; plus 25% of $1,100.00 = $1,375.00; plus 10% of $1,375.00 = $1,512.50. Mr Edwards' report of 28 October 2021[56] showed his calculation for item 2.1 as labour and materials = $395.00 + 10% of $395.00 = $434.00; plus 25% of $434.00 = $542.00; plus 10% of $542.00 = $596.00.

The arithmetic is the same but the inconsistent design of setting the figures out in that way made it time consuming to compare the experts' costings.

(i) Another thing was that Mr Edwards' last written costings preceded Mr O'Dowd's, and to bring his figures up to date Mr Edwards said that 30% should be added to his last written costings to adjust for price rises in the building industry. By using this broad brush approach Mr Edwards effectively adds more than 10% GST, to the advantage of the Stanleys.

(j) Both experts were comfortable with adding margin to a contingency so I will accept that as being appropriate.

1. Here are the items. Where EWH concedes liability for an item and Messrs O'Dowd and Edwards agree on the cost of rectification, I will state the number of the item and the agreed figure but not unnecessary detail.
2. Item 1.4 Expand the grated drain at the bottom of the driveway, outside the garage. Mr O'Dowd costs rectification at $5,066.88. Mr Edwards conceded that the drain is undersized, contrary to the requirements of the drainage documentation, but said that the purpose of the drain was to prevent water entering the garage and that as there was no evidence of water entering the garage, he opined that this was not a defect. However, video evidence was produced showing water entering the garage during heavy rain[57] which establishes that Mr Edwards' view was incorrect. I award the Stanleys $5,066.88.
3. Item 2.1 Entrance portico. Mr O'Dowd and Mr Edwards agreed on this item, including the cost of rectification the sum of $1,512.50. I award that sum.
4. 2.2 Item 1 Caulk gap. Initially Mr O'Dowd said $136.13 and Mr Edwards $165.10; and then they agreed on $165.10. I award that sum.
5. 2.2 Item 3 Flashing. Mr O'Dowd said $475.00 and Mr Edwards $617.50; and then they agreed on $617.50.[58] I award that sum.
6. 2.2 Item 4 Eave gutter holding water. Mr O'Dowd allowed $605.00 to remove and realign the gutter. Mr Edwards agreed that the defect exists but opined that Mr O'Dowd's scope of work was excessive in that the fall of the guttering could be adjusted to drain the water to the nearest downpipe. The difference between realigning and adjusting seems to be illusory and I am satisfied that Mr O'Dowd's method is more likely to succeed, and is appropriate. I award the Stanleys $605.88.
7. 3.1 Item 2 entrance door. Mr O'Dowd said $404.50 and Mr Edwards $440.00; and then they agreed on $440.00. I award that sum.
8. 3.2 Ensuite Item 1. Mr O'Dowd says that the fall of the tiles in the shower in the ensuite bathroom is inadequate, even though the fall is 10 mm over a distance of 1 m (ie, 1:100) which is within the recommended range of fall under AS3958.1-2007. He does not say that water is pooling in the shower. Mr Edwards notes that AS3958.1-2007 states a recommendation and not a requirement. As water is not said to be pooling in the shower I disallow this claim.
9. 3.2 Item 2. Mr O'Dowd says the grout between the tiles is discoloured and uneven. He costs rectification on the basis that the tiles are to be removed and replaced, which entails removing the shower screen, removing and replacing the screed and water proofing, and reinstating the shower screen. Mr Edwards says this scope of work is excessive and that the grout can be removed and replaced at a cost of $127.00. I accept Mr Edwards' view and award the Stanleys $127.00.
10. 3.2 Item 3. Messrs O'Dowd and Edwards agree that that screw caps are missing at the head of the sliding door. Mr O'Dowd's costing is $107.39 and Mr Edwards is $96.00. The difference is trivial and I accept Mr O'Dowd's assessment and award the Stanleys $107.39.
11. 3.3 Bedroom 1 Item 1. Mr O'Dowd identifies that one screw to the right of the architrave has not been filled or painted and an area of plasterboard in that region has not been painted. Mr O'Dowd costs rectifying the screw at $140.00 and painting the plasterboard at $720.00, both plus margin, continencies and GST. Mr Edwards agrees they are defects but assesses the cost at $513.00. The difference comes down to the common issue in defects cases, between the cost of sending a tradesperson to do one task, and the cost of having a tradesperson do several tasks while on site. Mr O'Dowd's figure is based on the former and I consider it to be excessive. I award the Stanleys $513.00.
12. 3.4 Plaster and framing issues, Item 1. Mr O'Dowd says that the plaster joint on the south side of the entrance passageway is poorly finished and highly visible, and Mr Edwards agrees. Mr O'Dowd also says the wall deviates from plumb by 4 mm, and Mr Edwards says that whilst there is deviation, a 4 mm deviation is within tolerance. Thus the area of contention between the experts is that Mr O'Dowd calls for the plaster o be removed, the frame to be straightened, and the skirting board to be replaced, whereas Mr Edwards says the plaster join must be rectified but that then it is only a matter of repainting the wall. Mr O'Dowd's costing is almost 7 times Mr Edwards' costing because of this difference in the scope of work. I find Mr O'Dowd's approach to be excessive and I accept Mr Edwards' assessment and award $498.00 to the Stanleys, which includes contingency, margin and GST.
13. 3.4 Plaster and framing issues, Item 2. Mr O'Dowd says that 4 corners are out of square. Mr Edwards agrees that 2 corners are - the south east side of the pantry and the north east side of the wardrobe in bedroom 3. Mr Edwards says the other 2 corners - the corner just east of the refrigerator and the corner on the south wall of the living room - are within tolerance. Mr O'Dowd's measurements show all of the corners to deviate beyond tolerance. The difference between the costings is very significant - $14,520.00 cf $2,252.00 - because Mr O'Dowd's methodology requires removal of plaster walls, skirting boards, the architrave in the pantry, straightening the frames and then replacing the plaster and repainting. Mr Edwards' methodology is essentially the same, but only concerning two corners. I accept Mr O'Dowd's opinion that 4 corners require rectification but I find his figure of $14,520.00 to be excessive. I award $5,000.00 to the Stanleys, which is double the Edwards' assessment on $2,252.00 plus approximately $500.00.
14. 3.4 Plaster and framing issues, Item 3. Mr O'Dowd reports minor cracking in plaster between the cornice and the wall above the wall oven, and between the cupboard above the refrigerator and the bulkhead, which he says are visible from a normal viewing position although he does not state the width of the cracks. He also says that reports of Simply Structural dated 12 July and 15 November 2021 said the cracks were visible then. Simply Structural did not state the width of the cracks and both of these dates are later than the 'handover' date. They can be rectified by refixing the joinery above the refrigerator, and by filling and caulking and repainting. Mr O'Dowd costed this at $1,436.88 including contingency, margin and GST. Mr Edwards says the cracking between the cornice and the wall above the wall oven is less than 1mm, and between the cupboard above the refrigerator and the bulkhead is less than 2 mm, both of which are within tolerance. As Mr O'Dowd has not stated the width of the cracks, I must prefer Mr Edwards' evidence and I do not allow any sum to the Stanleys in this respect.
15. 3.4 Plaster and framing issues, Item 4. Mr O'Dowd reports that there is a crack in the plaster wall west of the bathroom window, which he says is symptomatic of movement in the building. Mr O'Dowd did not otherwise report that there was movement in the building or provide any measurements that would verify that being the case. Mr Edwards does not consider this crack to be a defect. As the Stanleys have the burden of proof on this item, I reject it.
16. 3.4 Plaster and framing issues, Item 5. Mr O'Dowd reports that there are gouges in plaster work throughout the house. Mr Edwards says that he has not seen evidence that they were caused by the builder, which is quite different to saying, for example, that he had not seen gouges. Having viewed the home, and seen that it is sparsely furnished and decorated, perhaps showing the Stanleys' preference for minimalist design, I consider it unlikely that the Stanleys or any of their invitees gouged the plaster work and I find it more likely than not that EWH did so. Mr Edwards did not cost rectification because he did not see this as a defect and in those circumstances, I accept Mr O'Dowd's uncontested costing of $2,178.00 including contingency, margin and GST. I award that sum to the Stanleys.
17. 3.5 Paint issues. The experts agree on the existence of the 4 issues identified by Mr O'Dowd but disagree on the scope and the cost of rectification. The areas are:

(a) Item 1 paint finishes on certain architraves are rough, uneven, and have unfilled nail holes. Mr Edwards only concedes that this defect affects a lesser number of them than asserted by Mr O'Dowd and this explains the difference in the experts' costings. I accept Mr O'Dowd's opinion that the defect is more widespread than conceded by Mr Edwards, and on that basis I accept Mr O'Dowd's costing of $4,356.00 including contingency, margin and GST. I award that sum to the Stanleys.

(b) Item 2, the underside of the door head for the sliding door leading to bedrooms 2 and 3 has not been finished with a topcoat. Mr O'Dowd assesses the cost of rectification at $272.25 including contingency, margin and GST, and Mr Edwards at $127.00. I am satisfied with Mr O'Dowd's costing of $272.25 and I award that sum to the Stanleys.

(c) Item 3 Mr O'Dowd says there are areas of kitchen joinery leading into the laundry which have been over sprayed with paint, causing them to have paint overruns and be rough and unsightly; the paint finish on the south side of the living room is uneven; and that there are paint runs on the east wall of the garage. Mr Edwards agrees with the existence of these defects but the experts disagree on the cost of rectification, Mr O'Dowd's $1,678.88 including contingency, margin and GST cf Mr Edwards' $777.00. I am satisfied with Mr O'Dowd's costing of $1,678.88 and I award that sum to the Stanleys.

(d) Item 4 the tops and bottoms of all internal doors have not been painted. Failing to paint the top and underside of a door is not a trivial matter for the consumer because modern internal doors are not solid timber and the paint is necessary to provide a seal. At the same time, failing to paint these areas is an obvious "rip off", because the defects are concealed, and the contractor has been paid for work which he or she has not performed. Mr O'Dowd costed rectification of all of these doors, by removing them, painting them and reinstalling them, at $1,280.00 (plus contingency, margin and GST) which comes to $1,936.00. Mr Edwards sought to argue that time could be saved by doing this work in hot dry weather, to shorten the time between coats being applied, but there can be no sympathy for EWH in respect of this item. I award $1,936.00 to the Stanleys.

1. I am satisfied with Mr O'Dowd's costing of rectification of these 4 items in paragraph 141(a) - (d) and I award a total of $8,243.13 to the Stanleys.
2. 3.6 General issues:

(a) 3.6 item 1 Mr O'Dowd says the window frames are damaged by water ingress on the east side of the living room. Mr Edwards agrees. The dispute is not over the scope of rectification work because the two experts suggest the same method using slightly different words. Mr O'Dowd's costing is more than double Mr Edwards'. I cannot accept Mr O'Dowd's costing and I adopt and award Mr Edwards' costing of $1,163.00.

(b) 3.6 item 2 scratched kitchen tiles. Mr O'Dowd reports that 3 tiles in the kitchen are scratched. They were evident on the view. Mr Edwards does not dispute the existence of the scratches but opines that he has not seen evidence that they were caused by the builder. The scratches are such that they appear to have been created by a building contractor. No other areas of the kitchen, which has been used by the Stanleys now for some years, have similar scratches and I am satisfied that these tiles have not been scratched by normal wear and tear. I am satisfied on a balance of probabilities that the scratches were caused by EWH. Mr Edwards did not provide a costing and so I accept the unchallenged costing of Mr O'Dowd of $840.00 plus contingency, margin and GST which comes to $1,343.10. I award $1,343.10 to the Stanleys.

(c) 3.6 item 3 laundry door is creased and requires replacement. The experts agree on the existence of this defect but disagree on the cost of supplying and fitting a replacement as the means of rectification. Mr O'Dowd says $610.00 plus contingency, margin and GST, amounting to $922.63, and Mr Edwards says $679.00. Mr O'Dowd prices the door at $80.00 with the rest being labour. This convinces me that Mr Edwards' figure is to be preferred and I award $679.00 to the Stanleys.

(d) 3.6 item 4 laminated benchtop in laundry is discoloured and its gloss is inconsistent. The experts agree on the existence of this defect and Mr Edwards notes that it has already been replaced unsuccessfully. Mr Edwards actually assesses the cost of supplying and fitting a replacement as the means of rectification at a slightly higher amount than Mr O'Dowd, and in these circumstances I adopt Mr Edwards' figure and award $1,255.00 which includes contingency, margin and GST to the Stanleys.

(e) 3.6 item 5 Mr O'Dowd says there are gaps between the architraves and the walls, some of which are visible using a mirror device that allows one to look down on the architraves, but is not visible otherwise. Mr O'Dowd says these gaps adversely affect the energy rating of the home. He recommends caulking and touch up of relevant painted areas. Mr Edwards agrees that there is a large gap in one area only, and his suggested cost of rectification is very low as a result. I accept Mr O'Dowd's evidence that there are gaps in multiple areas, and I accept his cost of $1,633.50 which includes contingency, margin and GST. I award $1,633.50 to the Stanleys

(f) 3.6 item 6 Mr O'Dowd says windows are scratched throughout the home, which need to be polished out. Mr Edwards does not deny the existence of the scratches, which were visible at the view of the home, but opines that there is no evidence that it was caused by EWH. I am satisfied on the balance of probabilities that they were caused by EWH. There is nothing to suggest that the Stanleys could have caused them. They are consistent with rough handling during installation and other building works. Mr Edwards did not provide a costing and so I accept the unchallenged costing of Mr O'Dowd of $1,440.00 plus contingency, margin and GST which comes to $2,178.00.

(g) 3.6 item 7 the door frame of the sliding door to the al fresco is scratched. Mr Edwards does not deny the existence of the scratches, which were visible at the view of the home, but opines that there is no evidence that they were caused by EWH. I am satisfied on the balance of probabilities that they were caused by EWH. There is nothing to suggest that the Stanleys could have caused them. The scratches are consistent with rough handling during installation and other building works. Mr Edwards did not provide a costing and so I accept the unchallenged costing of Mr O'Dowd of $720.00 plus contingency, margin and GST which comes to $1,089.00.

1. On the basis of my findings as to the costing of rectification of the items in paragraph 143(a) - (g) I award a total of $9,340.60 to the Stanleys.
2. 4.0 Roof space:

(a) 4.0 item 1 Mr O'Dowd says there are gaps in insulation, and that additional insulation must be supplied to form a continuous barrier. Mr Edwards agrees but the experts differ very slightly on the cost of rectification: Mr O'Dowd's $302.50 cf Mr Edwards' $226.00. I accept Mr O'Dowd's assessment and award $302.50

(b) 4.0 item 2 the top of the air riser has been sealed with cardboard, which is not an approved product as it is flammable. It must be replaced with plasterboard. Mr Edwards agrees but the experts differ slightly on the cost of rectification: Mr O'Dowd's $650.38 cf Mr Edwards' $226.00. As Mr Edwards' figure does not allow for the cost of materials I accept Mr O'Dowd's assessment and award $650.38

(c) 4.0 item 3 Mr O'Dowd says the light fitting inside the roof space is not protected against damage and requires a protective shield. Mr Edwards agrees but the experts differ very slightly on the cost of rectification: Mr O'Dowd's $136.13 cf Mr Edwards' $112.00. I accept Mr O'Dowd's assessment and award $136.13.

1. On the basis of my findings as to the costing of rectification of the items in paragraph 145(a) - (c) I award a total of $1,089.10 to the Stanleys.
2. Paragraph 5 of Mr O'Dowd's costing related to 16 Plumbing items identified by Mr Newell. I deal with plumbing issues below.
3. 6.0 Remove and replace fixings [referred to in an email from Simply Structural, which did not prepare a formal report or give evidence in the hearing: in any event Mr O'Dowd costed this at $130.00]. The evidence on this item was minimal, but there was no opposition from Mr Edwards. In those circumstances I accept this claim is proven and I award $130.00 to the Stanleys.

1. The Stanleys rely on the evidence of Mr Newell in relation to plumbing issues. Mr Newell is an expert in plumbing. He has licensed accreditation with the Victorian Building Authority and has worked as a plumber for some 25 years. EWH relies on the evidence of Mr Edwards who concedes that he is not an expert in plumbing. The Stanleys submitted that Mr Edwards' evidence should be disregarded or given very little weight, whilst EWH maintained that the Tribunal needs to weigh up evidence of Mr Newell and Mr Edwards and decide which to prefer. Because the Tribunal is not bound by the strict rules of evidence, it is not obliged to refuse to admit the evidence of Mr Edwards on plumbing issues, and is able to weigh up the witnesses' evidence on plumbing issues.
2. Mr Newell's report dated 31 October 2021 appears at pages 148-216 of the Tribunal Book. In Appendix A he listed the documents that had been provided to him, which included the final building plans and the civil and engineering plans stamped on 18 September 2018. The report contains a narrative of his observations, and photographs taken during his inspection of the property. Regrettably Mr Newell did not number his items, but instead used bullet points. Mr Newell did not number his photographs. His conclusions are set out over four pages, but he gave a short 'heading' of an item on page 4, but then expanded on some items on pages 5-8. The absence of item numbers does not make the document easy to follow. There was ample time between 31 October 2021 and the hearing for Mr Newell to have re-engrossed his report with logical item numbers.
3. Mr Newell prepared a second report dated 18 November 2023[59] in which he added four items.
4. Mr O'Dowd costed the rectification of all of Mr Newell's items, giving them item numbers. Mr O'Dowd also re-phrased some of Mr Newell's descriptions, to identify the rectification method. So, for example, Mr Newell's first bullet point is, "Insufficient clearance from the top of the grate and finished floor level on the overflow relief gully" and Mr O'Dowd's item 1 is, "Remove paving at south side of home adjacent to overflow relief gully and lower overflow relief gully".
5. When EWH responded to Mr O'Dowd's costings in its final written submission dated 12 June 2024, it used a numbering system which was similar but not identical to Mr O'Dowd's. Paragraph 17 of the Tribunal's Practice Note PNVCAT2 has required experts to use consistent numbering of items - and not bullet points - in expert's reports since October 2014, as did its predecessor. Elegant variation in the numbering and description of alleged defects causes a considerable wastage of time.
6. For the purposes of these Reasons, the best description of Mr Newell's items are those in EWH's final submission, and so in setting out the items I have largely adopted its language. In adopting EWH's descriptions I am not changing the meaning of Mr Newell's reports. For clarity though, where relevant I have added some of Mr Newell's comment in [square brackets]:
   1. insufficient clearance from the top of the grate and finished floor level on the overflow relief gully [on the south side of the house]
   2. inspection shaft cover is not visible at ground level
   3. the stormwater drain is holding water [The junctions installed in the stormwater drain do not have the correct grade and are non-compliant with AS 3500-3 6.3]
   4. there is a hole in the stormwater drain [there are two holes in the stormwater drain on the north side of the house, allowing water to enter the subsoil]
   5. there is debris in the stormwater drain [The stormwater drain contains debris in several areas around the house, and it holds water rather than drains away. Mr Newell did not purport to opine on the source of the debris or the cause of it gathering]
   6. there is a cracked junction in the stormwater drain [There are cracks and breaks in the stormwater drain at the junction at the south-west corner of the house, allowing water to enter the subsoil]
   7. the shower waste outlet is under sized [The minimum requirement is 40 mm, where the waste insert and a smart waste meet, contrary to AS3500 13.17.1 and AS 3500-2 4.6.6.6]
   8. there are insufficient clips on the gas pipe work in the ceiling space
   9. there is no clip on the gas flue for the ducted heating unit [The gas flue for the ducted heating unit should have supporting clips in the ceiling space, but it does not, which is contrary to AS5601-1 6.8.2. A plumber had however issued a certificate of compliance in relation to the gas appliance flues]

1. there is insufficient roof area running to the rain water tank [There is a 2000 L poly rainwater tank installed at the south east corner of the house. The building plans call for two downpipes to run into the top of this tank, but only one downpipe has been installed. The effect of this is that less water gathered on the roof enters the tank]
2. the eaves gutter is holding water [The gutter is holding water in several areas around the house due to insufficient fall as required by AS3500-3 4.5.3]
3. there are dislodged washers under screws in the roof [ roof screws become dislodged, and may allow water ingress into the roof, contrary to AS1562 4.7]
4. no compression flashing was installed [the soaker flashing on either side of the front entry has been poorly installed, with no over flashing as required. A plumber had however issued a certificate of compliance in relation roof plumbing]
5. there are insufficient clips on the drain from the evaporative cooling unit
6. the sewer drain is holding water downstream from the laundry waste under the slab
7. no movement joints are installed in the sewer drain [which are required by appendix E of the VBA technical sheet relevant to the class of soil at the property, class P]
8. cardboard has been used to seal off return air duct in the ceiling
9. ducting has been squashed, restricting airflow in the ceiling space.
10. I add two issues identified by Mr Newell, which did not appear in EWH's submission:
    1. EWH had not installed an AG drain at the front of the house, and as a result the house did not have adequate surface drainage as required by BCA 3.1.2.3. A plumber had however issued a certificate of compliance in relation to below ground sewer and stormwater drainage.
    2. the channel drain in front of the garage is undersized
11. Mr Newell did not cost the rectification of the defects which he had identified. Mr O'Dowd costed Mr Newell's first set of defects in his initial Report dated 29 November 2021. Mr O'Dowd prepared a Supplementary Report dated 21 November 2023[60] in which he updated those costings to reflect his opinion of the current rates for labour and materials, and included costings of Mr Newell's second set of defects of 18 November 2023. In paragraph 6 of his Supplementary Report Mr O'Dowd wrote that his "cost estimates were to be viewed as estimates only, and should not be regarded as a quotation. Market forces can influence the cost of rectifications so it is advised at least two quotations from the market be obtained". In giving evidence orally, though, Mr O'Dowd generally stood by his estimates.
12. As I said above, Mr O'Dowd's costings were broken into:

"Scenario One" in which the house would be demolished and rebuilt. He costed this at $652,197.20 (including a contingency of 10%, builder's margin of 25% and GST) but said that the cost of up to 8 months' alternative accommodation and storage of furniture would have to be added; and

"Scenario Two", based on rectification of defects without demolition of the house. He costed this at $136,429.00 (including a contingency of 10%, builder's margin of 25% and GST) but said that the cost of up to 10 weeks alternative accommodation would have to be added.

1. Mr O'Dowd's costings of the plumbing defects are set out in Section 5 Items 1 to 17, on pages 19-22, of the Supplementary Report. Each item is broken into components and Mr O'Dowd has listed numbers of hours of labour [and relevantly on page 8 of the Supplementary Report he says he costs labour at $70 per hour for general trades, $60 per hour for labourers, and $100 per hour for licensed trades which would include plumbers], materials including by square metres when appropriate, and rubbish removal by cubic metre amount. Regrettably Mr O'Dowd did not set out the total costings of these plumbing Items. His cost estimates of the plumbing Items are 'within' the $136,429.00 in "Scenario Two".
2. Using the item numbers that I have adopted in paragraphs 154 and 155 above, by the end of the hearing (and as reflected in EWH's final written submission of 12 June 2024) EWH did not dispute liability in relation to items 7 (the shower waste); 8, 9 (gas flue clips); 10 (insufficient roof area running into the tank - although in the submission EWH said it does not dispute liability, but then submitted that the roof area could effectively be increased by diverting gutters to drain towards the tank, which begs the question of whether liability is admitted or not); 11 (eaves gutter holding water); 12 (roof screws); 13 (flashing); 16 (lack of movement joints); and 17 (use of cardboard).
3. EWH disputed the other items. However, Mr Edwards did not prepare a written report or costing of the defects identified by Mr Newell. Mr Edwards gave some evidence orally in which he rejected some of Mr Newell's expressed opinions, as matters of logic rather than as 'plumbing expertise'. For example, in relation to Mr Newell's observation of the cracked junction in the stormwater drain, Mr Edwards suggested that EWH had not installed the junction and that the break was consistent with the Stanleys' paving subcontractor having damaged it with a wheelbarrow. This was speculative in my view, as it quite clear that Mr Edwards did not see EWH or the Stanleys' paving subcontractor performing their work. In EWH's final written submission of 12 June 2024, EWH disputed many of the items on the basis that Mr Newell had made unsupported assumptions, or had not adequately explained his reasoning. Those submissions were essentially to the effect that the Stanleys had not satisfied their burden of proof in relation to those items. But it is not a persuasive submission: where Mr Newell literally observed and photographed a defect, and identified an Australian Standard which he said had not been complied with, it is very ambitious of EWH to suggest that he had not explained the basis of assumptions.
4. I accept Mr Newell's evidence, in preference to arguments and speculations raised by EWH. I set out my findings on the items.
5. In relation to item 1, it emerged during the hearing that the Stanleys had engaged a contractor to do landscaping and paving in the relevant areas. A building plan[61] confirmed this.
6. Mr Edwards opinion[62] was that the Stanleys had carried out extensive concrete paving and landscaping to the dwelling and the height of the overflow relief gully was consistent with it being altered in height to suit the height of the concrete paving. The gully was too high, and thus a defect, as a result of the Stanleys' contractor and not as a result of conduct of EWH.
7. Mr Newell's photograph and commentary on page 163 of the Tribunal Book was to the effect that the Australian Standard requires the top of the gully to be no less than 150 mm lower than the "lowest fixture connected to the drain". The lowest fixture is a drainage pipe inside the house, the height of level of which is dictated by the FFL. The lowest fixture is not the paving which surrounds the gully. It follows that the height of the paving is not to the point. The FFL is lower than was required by the contract, as conceded by EWH in its final submission, and therefore EWH is responsible for this defect. Mr O'Dowd's expert opinion of the cost of rectification was $8,969.13 and EWH has not presented an alternative costing. I accept Mr O'Dowd's costing and award the Stanleys $8,969.13.
8. In relation to item 2, the evidence is that the inspection shaft cover is not visible at ground level, because it has been covered by 'astroturf' which the Stanleys laid. When examined in the hearing Mr Newell was not prepared to go further than stating the obvious, that only if the astroturf was pulled back would it be possible to see whether the inspection shaft cover was at the correct, or incorrect, height. It is clear that the Stanleys have not satisfied their burden of proof in relation to this item. This rules out $460.00 (plus margin, contingencies and GST) for item 2.
9. In relation to items 3, 4, 5 and 6, EWH's position is that the Stanleys' contractor laid the stormwater drain when laying the paving, and that Mr Newell has not identified the gradient required by regulations of the Australian Standard or the gradient actually existing in the stormwater drain. EWH asserts that the stormwater drain is working.
10. I consider that Mr Edwards expresses views that do not deal with the defects as identified by Mr Newell. EWH constructed the stormwater drain. The Stanleys have proven relevant building defects in EWH's work. I accept Mr O'Dowd's recommended method of rectification, and his costings, which are uncontradicted. His assessment for these 4 items are: items 3 and 5 together $1,100.00; item 4 $7,720.00; item 6 $1,320.00 = sub-total $10,140.00 PLUS 10%, 25% and 10% for contingencies margin and GST = $15,372.50.
11. In relation to item 7, Mr Edwards conceded that the shower waste outlet was too small, however he disputed Mr O'Dowd's costing of $7,471.75 which was based on removing the shower and carrying out destructive work on that area of the slab and shower base. Mr Edwards did not provide a costing or details of his alternative method of rectification. Ultimately then this becomes a contest between evidence and no evidence, and as such I must accept Mr O'Dowd's costing of $7,471.75.
12. Item 8 is conceded by EWH. As to quantum, there was a miniscule difference between the costings put by Mr O'Dowd and Mr Edwards. I accept Mr O'Dowd's costing of $338.80 as being more realistic than Mr Edwards' slightly lower figure.
13. Item 9 is conceded by EWH. As to quantum, there was again a miniscule difference between the costings by Mr O'Dowd and Mr Edwards. I accept Mr O'Dowd's costing of $355.44 as being more realistic than Mr Edwards' slightly lower figure.
14. In relation to item 10, it seems to me that EWH conceded liability but suggested that more water could be directed from the roof into the water tank in a manner which would cost less than Mr O'Dowd's costing of $2,964.50. Ultimately, Mr O'Dowd's costing is based on making the work comply with the contract whereas Mr Edwards' slightly lower figure was based on a "work around". I see no reason why Mr O'Dowd's costing should not be accepted and so I award $2,964.50.
15. Item 11 is conceded, at $534.00, and I award that sum to the Stanleys.
16. Item 12 is conceded. Again, there is a minimal difference between the costings by Mr O'Dowd and Mr Edwards. I accept Mr O'Dowd's costing of $695.75 as being more realistic than Mr Edwards' slightly lower figure.
17. Item 13 is conceded. The cost of rectification is part of the cost of item 12, and so no separate amount is awarded to the Stanleys.
18. In relation to item 14, I accept Mr Newell's evidence that there are insufficient clips on the drain from the evaporative cooling unit, and given the absence of a competing view from Mr Edwards, I accept Mr O'Dowd's costing of $657.94.
19. Rectification of item 15, "sewer drain is holding water downstream from the laundry waste under the slab", is costed by Mr O'Dowd at $5,066.88. The first component of this cost, according to Mr O'Dowd, is the cost of obtaining advice from an engineer. The rectification work is then removing floor coverings, removing fixtures and fittings from the pantry and a walk in wardrobe, saw cutting the slab between the laundry and an ensuite bathroom, excavation, remove and replace the sewer, reinstate the various fixtures, fittings and floor coverings and provide protection works.

This item was not mentioned in Mr Newell's report of 31 October 2021. Its table of contents says the sewer drain is dealt with on pages 16 and 17.[63] Those pages deal with the inspection shaft being covered with astroturf [that is, item 2].

In Mr Newell's updating letter dated 18 November 2023[64] he wrote, "Please find an updated list of the defects identified at [the property]. The additional defects were outlined in the body of my report dated the 31st of October 2021 but were not added to the defect list on page 4 of the report" followed by a short list of additional defects including "Additional defects as outlined in the body of the report *The sewer drain is holding water downstream from the laundry waste under the slab". In fact, this issue was not "outlined in the body of (the) report dated the 31st of October 2021". The updating letter does not contain an explanation of how Mr Newell reached his conclusion or made his observation of this item; the volume of water allegedly being held; or the consequences which presumably would vary depending on that volume. There are no photographs of the item.

In the hearing, when evidence was being given by Mr Newell, Mr O'Dowd and Mr Edwards concurrently, Counsel for EWH objected to Mr Newell giving evidence around this topic and in the course of that objection Mr O'Dowd sought to explain his costing by reference to one of Mr Newell's photographs which Mr O'Dowd then acknowledged concerned a separate issue. It seemed to me then that the Stanleys withdrew this item from their claim.

In any event, I find that the Stanleys have not proven this item.

1. Item 16 was conceded, but there was a dispute over quantum. Mr O'Dowd costed rectification at $4,400.00 in his supplementary report of 21 November 2023, being $1,200.00 for materials and $3,200.00 for labour, and then added 10%, 25% and 10% for contingencies margin and GST to arrive at a total of $6,655.00. Mr Edwards did not reply to this costing and so I allow it at $6,655.00.
2. Item 17 was conceded and the consensus is that rectification of this minor defect would cost $235.00. I allow that sum.
3. Item 18, squashed ducting in the ceiling space, is mentioned in Mr Newell's supplementary letter of 18 November 2023. An unnumbered photo on page 13 of his first report[65] shows a flexible ducting pipe bent into a "U" shape, perhaps a little sharply, with the narration, "the ducting on the return air duct is squashed slightly reducing air flow". There is no measurement of the ideal quantity of air flow or the allegedly lower air flow which is taking place.

I find that the Stanleys have not proven this item. Mr Edwards did not cost it, nor did Mr O'Dowd.

1. In paragraph 34 of EWH's written submissions dated 1 July 2024, it says that the Stanleys should have the opportunity to present more evidence on the cost of alternative accommodation. This would necessitate evidence on the length of time for which alternative accommodation is said to be required, plus the reasonable cost of the same.
2. The duration of alternative accommodation being required will be affected by my decision that the house is not to be demolished and rebuilt. It is appropriate that both sides submit evidence and submissions on the item. The Stanleys should present their claim and supporting evidence first, and then EWH can decide whether to concede the claim or lead its own evidence on the cost of alternative accommodation. The parties are able to negotiate towards an agreed figure before incurring the costs of a further hearing.

1. I reject the Stanleys' submission that EWH's breach of the Caravan Requirement necessitates the demolition and reconstruction of the house, and so I reject Mr O'Dowd's "Scenario One" costing of $652,197.20.
2. Mr O'Dowd's "Scenario Two" costing at $136,429.00 is largely accepted. However as I have set out above, some of the individual claims in that costing have not been proven and I have identified above what has and what has not been allowed. Because Mr O'Dowd costs items individually on one page, and then applies contingencies margin and GST globally at the end, calculating "Scenario Two" to the extent allowed in my Reasons, excluding items which I have not allowed, is an exercise which can be far more efficiently conducted by Mr O'Dowd and his presumably efficient computer program, than by me using the Tribunal's abacus. The Tribunal's resources are stretched. Therefore, I require the Stanleys to file and serve the calculation consistent with my Reasons, and I give EWH an opportunity to object and provide an alternative arithmetical calculation consistent with my Reasons (and not an attempt to reopen issues) if it is convinced that this is necessary. I then propose to make an Order for the payment of the appropriate sum, which will be immediately enforceable. If the parties do not cooperate in this respect (see paragraphs 4 and 5 of my Order) I will do the arithmetic but the parties may experience delay and find that this process is a relevant consideration under section 109(3) of the Victorian Civil and Administrative Tribunal Act 1998.

1. The parties have acknowledged that the applicants would have to have the opportunity to give evidence on the calculation of their damages based on the cost of alternative accommodation and storage of chattels during rectification works. That claim can be quantified, now that it has been determined that the applicants' claim for the cost of demolition and rebuilding of the home has been rejected. Naturally the respondent must have the opportunity to be heard on the issue.
2. Similarly, the applicants' claim for damages, based on the cost of storing their caravan away from their home for a reasonable period of time, must be determined and both sides must have the opportunity to give evidence and make submissions on that issue.
3. Accordingly, a directions hearing must be held so that the parties can make submissions on the directions which ought be made to enable the damages for alternative accommodation and storage of the caravan to be determined efficiently and economically for the parties.
4. I reserve the parties' costs.

[1] Mrs Stanley gave evidence that this was the same width as the applicants' previous block.

[3] General, rather than detailed evidence, was given about these design guidelines. It was accepted by the parties that the guidelines could prevent the Stanleys from raising the garage roof as part of rectifying defects in the house.

[6] Pages 593 and 594 of the Tribunal Book.

[7] In addition, there was evidence about the control which the developer of the housing estate has over the appearances of houses, for example by being able to require certain façades, and to dictate set backs and heights. It is implied by this evidence that the work of modifying the slabs, which would doubtless then require the raising of the roofs of the garage and the house, would have to be approved by the developer. If the work of modifying the slabs was feasible, one could not have confidence that approval would be granted.

[8] [1954] HCA 36; (1954) 90 CLR 613.

[9] Counsel for the parties cooperated in attending to deficiencies in discovery and the tendering of these additional documents was by agreement

[10] [2020] VSC 388, especially at paragraphs 34-40, 44, 46 and 50.

[11] Particulars under paragraph 9 of the Amended Points of Claim. The clause is at page 505 of the Tribunal Book.

[12] Paragraph 6(b)(ii) of the Amended Points of Claim.

[13] Whilst described as an "informal sketch", it was a floor plan, with dimensions prepared by Mr Stanley on a computer.

[14] Paragraphs 4, 5 & 6 of the Amended Points of Claim.

[15] Paragraph 15 of the Amended Points of Claim.

[16] Paragraph 16 of the Amended Points of Claim.

[19] Page 28 of first day's Transcript.

[22] Commencing at page 503 of the transcript.

[23] The description "informal sketch" is a bit misleading. They were drawn by Mr Stanley using a computer program and so appear to be the work of a draftsperson. They have dimensions and indicate the position of the roof. As well as some internal walls being different, the first plan shows the house at 219.2 sq m and the second 224.2 sq m.

[25] Produced during the hearing and added to the Tribunal Book as page 800.

[26] Page 519 of the Tribunal Book; the discussion commences at page 515 of the Transcript.

[31] Pages 417-419 of the Tribunal Book.

[36] [1976] UKHL 1; [1977] AC 239.

[38] Paragraph 16 of EWH's Submissions in Reply dated 1 July 2024.

[40] Page 874 of the Tribunal Book, added during the hearing.

[43] Pages 923-932 of the Tribunal Book.

[45] Pages 933-942 of the Tribunal Book.

[49] [1954] HCA 36; (1954) 90 CLR 613.

[50] Bellgrove v Eldridge [1954] HCA 36 at [5].

[51] Pages 20-149 of the Tribunal Book.

[52] Pages 148-216 of the Tribunal Book.

[53] Pages 217-305 of the Tribunal Book.

[54] Pages 306-377 of the Tribunal Book.

[55] Pages 311-322 of the Tribunal Book, containing pages 5 - 16 of this report.

[56] Page 131 of the Tribunal Book, being page 111 of this report.

[57] Video 20211201-165119 filed in the Tribunal's case management system.

[58] Mr Edwards said he agreed with Mr O'Dowd's costing at $475.00, but in saying that he did not waive his 30% increase for inflation.

[59] Page 844 of the Tribunal Book, tendered during the hearing.

[61] Page 919 of the Tribunal Book showed areas of paving which were constructed by EWH, and the areas the subject of items 1 and 2 were not EWH's responsibility.

[62] Page 316 of the Tribunal Book, paragraphs 7.8 and 7.9 of his Report dated 17 February 2022.

[63] Pages 163 and 164 of the Tribunal Book.