6 April 2021, further affidavits and written submissions filed 11 August 2021 and 27 August 2021

Vincentis v SDJ Property Fifth Pty Ltd (Building and Property) [2022] VCAT 29

1. The claims relating to the bathrooms and powder room, the basement carpark and the fire separation issues are struck out.

2. The proceeding is listed for a directions hearing on 12 May 2022 at 3:15 pm for the purpose of making orders for the future conduct of the proceeding. The parties are invited to provide proposed consent orders prior to the directions hearing.

3. The costs of this application are reserved. I direct the Principal Registrar to refer any application for costs to me for further orders.

1. This is an application by the respondent for an order striking out parts of the applicant's Points of Claim dated 24 September 2019, brought under section 75 of the Victorian Civil and Administrative Tribunal Act 1998 ('the VCAT Act').

2. The claim relates to defects in the applicant's unit (no. 2) and in the common property. Senior Member Vassie made orders on 24 March 2021[1] giving the applicant leave to prosecute the proceeding on behalf of the Owners Corporation as well as on her own behalf. However he expressly did not decide the questions before me.[2]

3. The applicant commenced the proceeding on 6 March 2019 ('the Original Claim'). She filed an Amended Points of Claim on or about 30 April 2019 ('the April APOC') and a Further Amended Points of Claim dated 24 September 2019 ('the September APOC').

4. The respondent submits that three aspects of the claim pleaded in the September APOC should be struck out, as they were not articulated in the applicant's Original Claim filed on 6 March 2019, and are now out of time by reason of s134 of the Building Act 1993 ('the Building Act'). The three items are:

1. a claim (brought by the applicant on her own behalf) relating to inadequate waterproofing in the unit 2 wet area bathroom and ensuite ('the bathroom claim'). The claim was first expressly included in the April APOC, but the applicant alleges the issues were alluded to in the Original Claim;
2. a claim (brought by the applicant on behalf of the owners corporation) relating to defects in the basement carpark, being common property ('the basement claims'). The claim was first pleaded in the September APOC; and
3. a claim (brought by the applicant on behalf of the owners corporation) for inadequate fire separation in the walls of the common property ('the fire separation claim'). The claim was first pleaded in the September APOC.

5. The respondent also contends that the claims at paragraphs 8 and 9 of the September APOC should be struck out as these are superfluous now that the applicant has been given leave to prosecute the proceeding on behalf of the Owners Corporation. The applicant's solicitor advised at the hearing in April 2021 that he was not in a position to respond to this submission and all parties agreed at that time that the application need not be decided at this time (as their existence is not likely to cause further costs to be incurred). No further submission has been made on this point since the original hearing and accordingly I make no findings on this part of the respondent's application.

6. The parties each filed affidavits and submissions. They originally appeared before me on 6 April 2021 and I reserved my decision. While considering my decision it became apparent that not all the relevant occupancy permits had been tendered. On the Tribunal's own motion, I made an order dated 14 April 2021 giving the parties the opportunity to tender further occupancy permits relating to the occupation of the common property located above the basement carpark, together with any submissions. Several months were lost while the applicant issued summonses to produce documents. In the meantime, the Supreme Court decision of Lendlease Engineering Pty Ltd v Owners Corporation No.1 & Ors[3] ('Lendlease') was handed down, to which I drew the parties attention. Ultimately, the parties filed further submissions and affidavits in August 2021.

7. It is well-established that "the power to order summary or final judgement is one that should be exercised with great care and should never be exercised unless it is clear that there is no real question to be tried"[4].

8. Section 134 of the Building Act provides that a building action cannot be brought more than 10 years after the date of issue of an occupancy permit:

134 Limitation on time when building action may be brought

(1) Despite any thing to the contrary in the Limitation of Actions Act 1958 or in any other Act or law, a building action cannot be brought more than 10 years after the date of issue of the occupancy permit in respect of the building work (whether or not the occupancy permit is subsequently cancelled or varied) or, if an occupancy permit is not issued, the date of issue under Part 4 of the certificate of final inspection of the building work.

'building action' means an action (including a counter-claim) for damages for loss or damage arising out of or concerning defective building work.

10. Where neither an occupancy permit or a certificate of final inspection are issued, the time limit for bringing an action is measured in accordance with the _Limitation of Actions Act 1958 ('_the LOA Act'), being 6 years from the date on which the cause of action accrued: Gledhill v Scotia Property Maintenance Pty Ltd[5] ('Gledhill').

11. The applicant tendered and relies on the following Occupancy Permits:

1. Occupancy Permit for the basement carpark issued on 4 December 2008, and
2. Occupancy Permit for unit 2 issued on 11 March 2009.

12. Following her further enquiries, the applicant apparently located other occupancy permits, but she did not tender these as she said they are not relevant.[6]

13. Relying on the dates of the tendered Occupancy Permits and s134, the respondent contends in summary that:

1. The Original Claim made on 6 March 2019 is within time, insofar as the items claimed at that time relate to unit 2.
2. Any subsequent claims purportedly made for other items in unit 2, as set out in the April APOC or September APOC, are statute barred as the time limit expired on 11 March 2019 (being 10 years after the date of the unit 2 Occupancy Permit).
3. If the Original Claim made on 6 March 2019 had included claims for defects in the common property other than the basement carpark, these claims would be within time, based on the Occupancy Permit issued on 11 March 2009.
4. Any subsequent claims purportedly made for common property defects other than the basement carpark cannot be brought after 11 March 2019. As no claims for common property defects were made in the Original Claim, they are statute barred by the time of the April APOC or September APOC.
5. Any claims for the basement carpark cannot be brought after 4 December 2018 (being 10 years after the date of the basement Occupancy Permit), and so they are statute barred, whether or not they were first included in the Original Claim, the April APOC or September APOC.

14. The applicant has summarised her response as follows:[7]

1. The date of the latest Occupancy Permit (11 March 2009) is the date from which time starts to run for all claims (relying on Lendlease).
2. The principle of "relation back" enables the addition of defects issues to be pursued after the 10 year time limitation expires provided the proceeding was started prior to the 10 year limitation and any prejudice to the respondent can be addressed.[8]
3. The scope of the defects in relation to common property is "at large" and able to be pursued by the applicant on behalf of the Owners Corporation without time limitation difficulties because there was no Certificate of Occupancy issued in relation to common property.
4. The scope of the defect issues able to be pursued is enlarged [sic] due to the fact there was no building permit issued for the carpark basement slab and walls and hence no certificate of occupancy can apply to that work.

Which Occupancy Permit date is applicable: Lendlease

15. In Lendlease, the Supreme Court of Victoria recently considered the application of s134 in the context of a development where multiple occupancy permits were issued.

16. In that case, the contractor contended the 10 year limitation period for the bringing of a building action under s134 runs from the date of the Occupancy Permit issued in relation to the relevant state of the works, whereas the owners contended that the relevant date is the date of the last Occupancy Permit. The Court agreed with the owners in the context of that development.

17. In Lendlease, there were four occupancy permits, issued over an extended period. The works certified in those permits overlapped. Specifically, the works referred to as the apartments and associated common property in Building 1 were subject to each of the four Occupancy Permits. A 'final' occupancy permit covering the whole building was issued in February 2007: It certified (inter alia) that all apartments and associated common property of both Buildings 1 and 2 were suitable for occupation. In those circumstances, the Tribunal at first instance and the Court on appeal determined that the "FINAL Occupancy Permit" is the relevant date for limitation purposes.

18. In the present case, more than two occupancy permits were issued. Based on the applicant's submission that the only relevant dates are those of 4 December 2008 (the Occupancy Permit for the basement carpark) and 11 March 2009 (the Occupancy Permit for unit 2), the question before me is whether the decision of Lendlease means the time for the applicant to bring a claim in respect of defects in the basement started to run from the date of the later occupancy permit, being 11 March 2009.

19. I am bound to follow a decision of the Court if it is factually substantially similar to the case at issue. However, I do not consider that Lendlease is on all fours with the present case, and so I distinguish it. In Lendlease, each of the earlier occupancy permits were subject to a final permit being issued covering the whole building. In the present case, on the evidence before me, there was no requirement for a 'final' occupancy permit for the whole of the building, or for any permit that related to the works in their entirety. Instead, a number of standalone occupancy permits were issued, one for each unit at about the dates they were sold[9] and one earlier permit for the basement. Each of the tendered occupancy permits state "The building or part of the building to which this certificate applies is suitable for occupation".

20. While the facts of the present case are different to the situation in Lendlease, my conclusion is consistent with the comments of Her Honour at [60] (my emphasis added):

60 ... While an occupancy permit is issued in respect of identifiable building work, it is not evidence that the building work complies with the act or regulations, only that the building or part thereof is in fact suitable for occupation. The purpose of an occupancy permit, by s 39, is to make it an offence for any person to occupy any part of a building where a permit is required but not issued. By selecting the occupancy permit as identified by s 21(1)(b), or the certificate of final inspection, Parliament's intention and purpose was to fix an identifiable date for time to commence sufficiently proximate with the conclusion of the building work in that building.

61 Where, in accordance with s 39, a building permit states that an occupancy permit is required for the whole of the building, then, notwithstanding that an occupancy permit may provide that part of that building is suitable for occupation under s 46, the whole of the building subject to occupancy is not achieved until the last occupancy permit is granted.

21. The Lendlease decision turned on the time that the whole building was subject to occupancy. In the present case, each unit was ready to be occupied as at the dates of their occupancy permits (per the evidence that: Certificates of Occupancy were issued after the appliances were installed, and appliances were only installed when settlement of the sale of a unit was imminent[10]). There was no building permit which stated that an occupancy permit would be required for the whole of the building.

22. Accordingly, on the evidence before me, I am satisfied that separate time limits run based on each separate occupancy permit. The latest date by which an action could be brought in respect of defects in the basement carpark is 4 December 2018. The latest date for defects in Unit 2 is 11 March 2019.

What if s 134 does not apply - Gledhill, Mason?

23. Gledhill was followed in Fraser v Mason and approved by the Supreme Court of Victoria on appeal in Mason v Fraser.[11] It is now established law that where neither an occupancy permit or a certificate of final inspection are issued, the time limit for bringing an action is measured in accordance with the LoA Act, being 6 years from the date on which the cause of action accrued.

24. Accordingly, insofar as the applicant has contended that s134 does not apply to the common property and the basement carpark slab and retaining walls (see paragraphs 14(c) and (d)), the consequence is that time would run in accordance with s5 of the LoA Act.

Can later claims be 'related back to the Original Claim' - Brirek, Agtrack, May?

25. In Brirek Industries Pty Ltd v McKenzie[12] ('Brirek') the Court of Appeal considered the temporal effect of an amendment to a claim. The proceeding had been commenced in the County Court, and the original statement of claim was filed in December 2008. An amendment was allowed in September 2010 and the trial judge and counsel for both parties had proceeded on the assumption that for the purposes of statutes of limitations, the claim introduced by the 2010 amendment was to be analysed as if that claim had been issued on that day.

26. However on appeal, a new ground of appeal was raised to argue that the doctrine of 'relation back' should have been applied, meaning that the amendment should have spoken from the date of the document which was amended, namely the date of the original statement of claim in 2008.

27. In a joint judgment the Court of Appeal held that the assumption of the trial judge and counsel was mistaken and that the relevant date for calculating time should have been the date of the original statement of claim in 2008. The Court discussed the development of the doctrine (paragraphs 193 - 199) and concluded at [200] - [201]:

In our opinion, despite the assumption of the trial judge, the amendment related back to the date of the original pleading. The trial judge erred in assuming that the amendment he had permitted 'spoke' only from the date on which it was made.

The amendment which was proposed in this case ... constituted nothing more than a different legal conclusion based upon facts already in issue in the proceeding...

28. The Court of Appeal referred to and agreed with the observations of Ormiston JA in Agtrack (N.T.) Pty Ltd (T/a Spring Air) v Ann Christine Hatfield[13] ('Agtrack'). That case concerned a claim brought by the widow of a man who was killed when a Cessna 210, in which he was a passenger on a sightseeing tour in the Northern Territory crashed. She brought the action against the company which had contracted to carry her husband, originally in negligence and in breach of statutory duty. There was no dispute that the proceedings were validly issued. The widow later became aware that a claim was only available under Part IV of the Civil Aviation (Carriers Liability) Act 1959 and she sought to amend to plead a claim under that Act even though the time limit for bringing such an action had expired.

29. Ormiston J described the consequences of an amendment on time at [117] as follows:

Undoubtedly, the consequence that amendment, once effected, relates back to the issue or filing of process is well accepted ... But what does that statement mean? To my way of thinking it means no more than this: amendment involves making an alteration to an existing document and that document will have come into existence at some time in the past; whoever amends such a document is not normally creating an entirely different document, but is merely effecting a change or changes to that which is already in existence, which itself has a known date upon which it came into effect. One could "substitute" a new document of the relevant kind and that might connote the creation of a document taking effect only at a later date. In fact, as a matter of practice, where some special problem has arisen, occasionally judges have directed that certain amendments to pleadings only take effect as at the date of the making of the amendment, but that ordinarily comes about by a specific order.

30. The Court of Appeal in Agtrack dismissed the appeal against the decision of the trial judge to 'relate back' the amendment to the date of the original statement of claim. Ormiston JA said at [77]:

The present case, however, is not a case where a completely new claim, said to have been extinguished by the Act, is sought to be added by way of amendment where no likely claim previously was asserted. As I have previously sought to explain, all that the amendments in the present case sought to achieve was to add to an existing claim, which was already on foot, certain (effectively) jurisdictional allegations, together with an allegation that the proceeding was brought pursuant to Pat IV of the Act... For practical purposes, all the relevant facts were asserted in the original statement of claim and the only facts omitted were in substance jurisdictional facts or facts which one would have to prove only to show that the respondent had the right to bring the action.

What is here in issue is an amendment seeking to add or vary a few minor details and to give the existing claim a new characterisation, closely akin and by no means remote from the subject matter of the original claim. That is a true amendment and the very kind, which the Court ought to be free to give effect to. It affects only an action already on foot

32. In Owners Corporation PS No.1 519798G & Ors v May & Ors[14] ('May') the Tribunal permitted the applicant to amend their claim after the 10 years had expired. The amendment was to allow the applicant to rely upon a breach of s137C of the Building Act, instead of the s8 warranties given under the _Domestic Building Contracts Act 1995 ('_the DBC Act'). The defective building work requiring rectification did not change. DP Aird considered Agtrack and held as follows at [28]:

Similarly [to Agtrack], in this proceeding, the applicants filed an application within the 10 year limitation period set out in s134 of the Building Act claiming the cost of rectification of alleged defective building work. The basis of the claim, whether it be the s8 warranties or the s137C warranties is irrelevant. In amending the POC to rely on the warranties contained in or implied into the contracts of sale, I am satisfied it is arguable that their claim has not changed, and that they have not sought to commence a 'new' building action as defined in s129 of the Building Act in filing the APOC.

33. It seems to me that s134 of the Building Act and the authorities referred to above give rise to the following proposition: that where an action is commenced in time, and an amendment is sought to be made after a limitation period has expired, the amendment does not constitute a new claim if all it is doing is re-characterising the nature of the claim, or seeking a different legal conclusion based upon facts already in issue in the proceeding. It is an amendment of a claim already issued and takes effect from (i.e. can be related back to) the date of the original claim. However if the amendment has the effect of introducing a new claim, where no like claim previously was asserted, then it is not a true amendment of the original claim, but instead is a substitution of a new claim which takes effect only at the later date.

34. Accordingly, the questions in this proceeding are whether or not:

1. the defects alleged in the April APOC or September APOC were raised in the Original Claim; and if not
2. whether the addition of new defects is an amendment of the Original Claim which was issued in time, or whether it is in effect a new claim and therefore statute barred.

35. On 6 March 2019 the applicant filed her application, together with a document headed 'Points of Claim', a table headed 'Monetary Claim for Repairs to 2/928 Doncaster Road Doncaster East Vic 3109', a number of other documents and two expert reports.

36. In the Points of Claim the applicant lists four 'dot points' which alleged:

• "Floor boards in the living, meals and kitchen area damaged due to ingress of water from exterior courtyards.
• Recommended repairs works to the floorboards. Spec [the respondent] have offering to only 'reinstate' and 'patch' the damaged floor area. Spec have not offered to re-sand and polish the entire floor and have suggested that I pay for half of the sanding and polishing work.
• Waterproofing of courtyards inadequate. Attempts to resolve these issues with re-grouting of the courtyards was questioned in [sic] to ensure long-term protection from water ingress into the living areas.
• As a result of the ongoing delays and what I [the applicant] believe to be adequate resolutions to the current issues, I am requesting a financial settlement from Spec in order to engage trusted tradesmen to repair and correct the issues."

37. No other items are claimed in the balance of the Points of Claim.

38. In the table headed 'Monetary Claim for Repairs to 2/928 Doncaster Road Doncaster East Vic 3109' (the Table), the applicant has listed 22 separate amounts claimed. These include reimbursement of the costs of the building inspection reports, obtaining copies of documents, the VCAT application fee, furniture removal and storage and alternative accommodation. Insofar as she claims money for defective works, she lists the required repairs and amounts as follows:

kitchen is laid over the floorboards, replacement of the floor requires the remove of the kitchen

cost to cover window which were tinted in October 2018

39. The two reports provided with the application form are by Nick Poulos of Melbourne Property Inspections dated 7 September 2017 ('the Poulos report') and Barry Tanner of Melbourne Building and Waterproofing Consultants dated 10 January 2019 ('the first Tanner report'). I will discuss their contents below.

40. On or about 30 April 2019 the applicant amended her claim to include a claim that the "wet areas" "located on the 2nd floor"[15] in her unit have not been waterproofed or constructed in accordance with the Australian Standard or National Construction Code. In the document headed 'Back Ground of amended Claim' the applicant said:

"In January I began some maintenance updates to my ensuite ... We proceeded to remove the tiles to replace them ... On removing the damaged tiles, we discovered that there was not water protection/cement sheeting on the floor and not waterproofing agent behind the tiles in the shower... On discovering this I proceed to contact the following companies for advice and direction ... I have been advised none of the wet areas installed are compliant with the waterproofing regulations that were in effect in 2008/2009... I have amended my original costings to include the additional work required to rectify the issues."

41. She provided a report with the April APOC from Barry Tanner of Melbourne Building and Waterproofing Consultants dated 12 April 2019 ('the second Tanner report') and a quotation from Ultra Home Improvements dated 18 April 2019.

42. The respondent contends that none of the bathroom issues were raised with it during the 10 years since the occupancy permit.[16] Nor were they raised in the Original Claim. They are not mentioned in the Points of Claim or in the Table. Both the second Tanner report and the quotation were obtained after the limitation period had expired. It is too late for the applicant to now bring these claims, by reason of s134.

43. In response, the applicant makes alternate arguments. First, she says that the bathroom claim is not a new claim, as issues with the bathroom were alluded to in the Poulos report and the first Tanner reports which were filed with the application form. Second, she says that if the claims are for new defects, then they should be allowed as they are a minor amendment of the Original Claim which was issued in time.

44. In respect of the first submission, the applicant says that even though these items are not noted in the Points of Claim or the Table, the application should "be understood as including a claim for all defects referred to or related to any issues raised in the Points of Claim, the Poulos report or the [first] Tanner report".[17] She relies on the following paragraphs in the Poulos report which she says clearly refer to bathroom defects the cause of which are due in part to faulty/lack of waterproofing:

1. page 8 summary referring to Bathroom 2 Shower and Bath: "tile grout deterioration;"
2. page 10: Powder Room Door: "door not lock closing ... this can relate to some differential settlement in the footings, frame movement, age, expansion, shrinkage and the like."
3. page 10: Bathroom 1 Shower & Bath: "shower base drain has been sealed. The sealant must be removed to allow any water penetration behind the wall to be released."
4. page 10 Bathroom 2 Door: water damaged door frame. Possible due to leak in bathroom."
5. page 10 Bathroom 2 Shower and Bath: "Shower base drain has been sealed. The sealant must be removed to allow any water penetration behind the wall to be released."
6. the above defects are also described in pages 49-55 of the report;

45. She also refers to the following paragraph in the first Tanner report:

1. p29: "This section of parquetry outside the laundry has been water affected possibly from the laundry;"
2. p30 records moisture levels adjacent to the laundry;

46. The applicant submits that as the Tribunal is aware, water leaks can be impossible to locate until destructive testing is enacted. That is why she was not more particular in her Original Claim.

47. In response, the respondent contends that although the Poulos report mentions some issues in the bathroom, they do not amount to a claim for a lack of waterproofing or breach of Australian standards or regulations. The Poulos items bear no resemblance to the matters identified in the Ultra Home Improvements quote or the second Tanner Report. Further, the reference to water in the first Tanner report is moisture adjacent to the laundry and has nothing to do with any bathroom. It is irrelevant.

48. Moreover, the September APOC makes no reference to the Poulos report. If the applicant ever intended to rely on the report, she did not do so as at September 2019.

Discussion and conclusion about the bathroom claim

49. I do not accept the applicant's submission that concerns about a lack of waterproofing of the wet areas in unit 2 was included in the Original Claim. A mention in the Poulos report of some issues in the bathrooms and powder room does not mean that the applicant brought a claim for loss and damage caused by water damage or a lack of waterproofing in her Original Claim.

50. First, I agree with the respondent's submission that simply including a report with a Points of Claim "does not somehow elevate the entire content of that report to form part of the claim"[18], in circumstances where the applicant has particularised her claim by providing Points of Claim and an itemised Table. Had she not particularised the claim in her Points of Claim or in the Table, the applicant would have a stronger argument that her claim was for everything in all of the documents filed. However, by actively selecting the items listed in the four dot points in the Points of Claim and the amounts claimed in the Table, I am satisfied that she had considered and decided to claim only for those items.

51. My view is supported by the applicant's own words in her April APOC (see paragraph 40), where she has admitted she was aware of the bathroom issues before she commenced this proceeding. Had she intended to claim for them, they would have been one of the dot points in the Points of Claim or one of the items in the Table.

52. Second, if I am wrong about that, I would nevertheless reject the applicant's contention, as Mr Poulos did not actually identify any items which could have been the consequence of a water leak in a bathroom. Had he identified any such items, then it is arguable that a claim had been made for loss and damage caused by a water leak, even if the cause of the leak was not established at that time. However, the issues identified by Mr Poulos do not indicate that he had any concerns about water leaks. Instead, his description of and his recommendations for each item listed by the applicant's solicitor (at paragraph 44 above) are as follows:

1. page 8 "tile grout deterioration" - he recommends regrout / seal and seek advice from a qualified plumber;
2. page 10 "powder room door not lock closing" - he refers to the door frame being out of square, the possibility of structural movement, and recommends a carpenter provide advice;
3. page 10 Bathroom 1 "shower base drain has been sealed" - he says sealant should not have been used and should be removed;
4. page 10 Bathroom 2 Door - although Mr Poulos says the water damaged door frame was possibly due to a leak in the bathroom, he recommends the door be replaced. There is no reference to a concern about the waterproofing of the bathroom.
5. page 10 Bathroom 2 "shower base drain has been sealed" - he says sealant should not have been used and should be removed.

53. Similarly, there are no concerns raised about the waterproofing of the bathrooms or other wet areas in the first Tanner report.

54. Accordingly, I do not accept the bathroom claim was made in the Original Claim, because it was not raised in the Points of Claim, in the Table or in the expert reports filed with the claim. Further, the applicant has stated that she commenced the proceeding in March 2019 because she knew that the limitation period was due to expire. At that time she was aware of the lack of waterproofing. In those circumstances I am satisfied that she chose to not include the claim in her Original Claim. She cannot now revisit that decision.

55. The second question then is whether the April amendment to include the bathroom claim should be related back to the Original Claim, and thus be made in time, or whether it is a new claim and is therefore statute barred.

56. I am satisfied that the amendment goes further than "seeking a different legal conclusion based upon facts already in issue in the proceeding" (per Brirek) or "adding or vary a few minor details and to give the existing claim a new characterisation, closely akin and by no means remote from the subject matter of the original claim" (per Agtrack) or being a change to "the [legal] basis of the claim" when "the cost of rectification of alleged defective building work" had already been claimed (per May).

57. The amendment to claim a new head of loss and damage, unrelated to anything else previously claimed, is not a true amendment of the Original Claim, but instead is a substitution of a new claim which takes effect only at the date of the amendment.

58. Further, I do not accept the applicant's submission that the addition of out of time claims does not prejudice the respondent. The onus is on the applicant to demonstrate there is no prejudice to the respondent in the late amendment.[19]

59. I accept the respondent's evidence[20] that if the applicant were allowed to amend her claim to include the bathroom defects, the respondent would suffer a prejudice which could not be remedied. The respondent no longer holds records about the bathroom works, including details of what the contractors did what work and on whose instruction, and key personnel who worked for the respondent during the period no longer work for the company. Further, it is not possible to locate relevant documents elsewhere: the relevant building surveyor no longer holds any relevant documents and the Tribunal's file in an earlier proceeding (which was settled) has been destroyed.

60. Accordingly I am satisfied that the claims related to the bathrooms and powder room should be struck out. As the applicant has not identified these items with any specificity (her September APOC merely plead that "particulars of the defective works have been provided in independent reports", which are then listed) it will be a matter for the parties to work out which parts of which documents should be struck out.

61. The first time that issues in respect of the basement were expressly raised was in the September APOC. In that document the applicant pleads that the respondent is in breach of the statutory warranties implied into the building contract by s8 of the DBC Act, in that the building work is defective. Particulars of the Defective Works include:

"the report of consulting structural engineer, Mr Harry Liden of Simply Structural Engineers Pty Ltd dated 12 August 2019".[21]

62. The Simply Structural Report describes issues with unit 2 and with the "common basement carpark area". Mr Liden describes the "common basement carpark area" as having "individual enclosed garages to each unit. The basement retaining walls are constructed with reinforced concrete block work, and support a concrete slab directly above. The units above comprise of two level dwellings (with a common basement below) ..."[22]

63. Insofar as he identifies defects with the construction of the basement carpark area, Mr Liden's opinion is that[23]:

8.05 surface corrosion has also been identified to the exposed steel beam is directly above the Basement access stairs. Additionally, it is noted that further internal basement steel work with surface corrosion is evident however Ltd in view.

8.06 Efflorescence is also evident to the inside face of the concrete block work to the complete basement perimeter. Ground moisture penetration through the concrete block work (with salt residue to the inside face) occurs as a result of inadequate (or limited application of) waterproofing to the external face of the retaining walls.

8.07 The basement drainage constructed has been altered from the engineered design. The omission of the internal spoon drains and surface pits will compromise the performance and maintenance capacity of the drainage system...

8.08 Block work cracking is also evident to the stair void basement access locations, where screen walls have been attached directly above. As the screen wall connectors are typically positioned within the upper block courses, the additional wind loading and vibration through such connectors has resulted in block work movement and cracking.

64. The respondent submits that as the Occupancy Permit for the basement carpark was issued on 4 December 2008, by reason of s134 of the Building Act, any claims arising from the building work carried out on the basement cannot be brought after 4 December 2018. As the applicant did not commence this proceeding until 6 March 2019, any claim made by her for the basement (either on her own behalf or on behalf of the Owners Corporation) is statute barred.

65. In response, the applicant contends that having examined the available documents, it is arguable that no building permit was ever issued for the basement slab and walls, and on that basis, no occupancy permit was issued and therefore time under s134 has not started to run. The applicant relies on an Order issued by the building surveyor dated 20 March 2008, in which the developer was ordered to stop building work because "site excavation and basement walls have been constructed without a stage 1 building permit being issued. (Council property information was outstanding)".[24] The applicant asks me to conclude from this Stop Work Order that the works on the basement were completed with no building permit having been issued and therefore no Certificate of Occupancy could issue, by reason of the Building Act. As a result, the time limit has not started.

66. Alternatively, the applicant submits that the claim can be "related back" to the Original Claim, as any prejudice to the respondent can be addressed.

Discussion and conclusion about the basement claim

67. First, for the reasons set out above (see paragraph 21) I am satisfied that the time limit for bringing claims in relation to the basement carpark expired on 4 December 2018. As this proceeding was not commenced until March 2019, any claims made in relation to the works the subject of the Occupancy Permit issued 4 December 2008 are out of time.

68. Second, if I am wrong about that, and Lendlease applies such that the relevant expiry date would be 11 March 2019, the purported claim for the basement is still out of time, as the defects were not identified until Mr Liden's report of 12 August 2019 (as pleaded by the applicant- see paragraph 61). Accordingly, it is unarguable that no claim was made for the basement carpark in the Original Claim dated 6 March 2019, and even if the applicable date was 11 March 2019, the applicant did not meet it.

69. Third, I do not accept the applicant's submission that no Occupancy Permit was issued for the basement. The submission is as follows [25]:

14. The building permit for the project expressly excludes the basement carpark slab and retaining walls (attached)... Recently the Applicant ... discovered the Respondent builder built the basement carpark including slab and retaining walls without a building permit: see the attached affidavit from the Applicant dated 6 August 2021 and the exhibits thereto to the effect the RBS ordered stop work on the site.

15. This explains why the building permit excludes the basement carpark and retaining walls.

16. The Building Act limits the issue of a certificate of occupancy to work that has a building permit: the Building Act 1992 is designed such that it is implicit that an occupancy certificate will only be issued in relation to work subject to a building permit.

70. The applicant has not specified which section of the Building Act she relies on to support the contention that "an occupancy certificate will only be issued in relation to work subject to a building permit". I am not aware of any such section.

71. Fourth, even if that proposition is correct, there is no evidence before me that a building permit was never issued for the basement. It is obvious from the wording of the Stop Work Order that an application had been made for a building permit and that Council property information was outstanding. If that information was provided by the developer following the Stop Work Order, it is likely that the building surveyor would have then issued the building permit. The applicant has not provided any other documents from the Council's file to indicate that the works continued without a building permit. Accordingly, I am not satisfied that the basement carpark was constructed without a building permit.

72. Fifth, even if the applicant is correct in her contention that no occupancy permit was issued for the basement, her claim nevertheless is still out of time. As discussed above (see paragraph 10), where neither an occupancy permit or a certificate of final inspection are issued, the time limit for bringing an action is measured in accordance with the LoA Act, being 6 years from the date on which the cause of action accrued. The claim is pleaded as a breach of warranties (see paragraph 61) and accordingly the cause of action would accrue at the time of breach, which is the[26]ate of the contract.26 I have not been provided with this date, but it is obviously prior to June 2008 (being the date of inspection of the slab steel for the carpark). Accordingly, whether the claim for the basement carpark was made in the Original Claim, or the April APOC or the September APOC, it is significantly later than six years from the date of the building contract.

73. Sixth, for the reasons set out above in relation to the bathroom claim, I do not agree that the basement claim can be related back to the Original Claim. The amendment in the September APOC goes further than "seeking a different legal conclusion based upon facts already in issue in the proceeding" (per Brirek) or "adding or vary a few minor details and to give the existing claim a new characterisation, closely akin and by no means remote from the subject matter of the original claim" (per Agtrack) or being a change to "the [legal] basis of the claim" when "the cost of rectification of alleged defective building work" had already been claimed (per May). The amendment to claim a new head of loss and damage, unrelated to anything else previously claimed, is not a true amendment of the Original Claim, but instead is a substitution of a new claim which takes effect only at the date of the amendment.

74. Seventh, insofar as the applicant alleges the respondent would not be prejudiced if the amendment were allowed, I reject the submission for the reasons set out at paragraphs 58-59 above.

75. Eighth, I do not agree with the applicant's characterisation of the orders made by Senior Member Vassie on 24 March 2021. As set out at paragraph 2 above, while he gave the applicant leave to prosecute the proceeding on behalf of the Owners Corporation, he expressly did not decide the respondent's application that the claim would be out of time.

76. In conclusion, I am satisfied that any claims made in relation to the basement carpark must be struck out. As the applicant has not itemised the basement claims, instead only referring to the Simply Structural Report, I am unable to strike out specific paragraphs of the Points of Claim. Again, I will leave it to the parties to work out which parts of which documents should be struck out.

77. As with the basement claim, a claim related to inadequate fire separation in common property was first pleaded in the September APOC. The expert Mr Beck has stated he noticed the expanded cladding issue during his inspection in July 2019.

78. It is obvious that this claim was not made earlier, as the issue was not known to the applicant or her experts until at least July 2019. For the purpose of this application the respondent accepts that the relevant limitation period expired on 11 March 2019. They submit that as the claim was not made until September 2019, it should be excluded, whether or not the claim is brought by the applicant or on behalf of the Owners Corporation.

79. In response, the applicant contends that no occupancy permit was ever issued for the common property, and on that basis, time under s134 has not started to run. Alternatively, the applicant submits that the claim can be "related back" to the Original Claim, as any prejudice to the respondent can be addressed. Alternatively, the applicant says she has already obtained leave from VCAT to pursue the owners corporation claims by decision dated 24 March 2021.

Discussion and conclusion about the fire separation claim

80. As with the basement claim, I do not accept the applicant's contention that no Occupancy Permit was issued for that part of the property where the fire separation issue is located. She has suggested that because no permit has been located specifically naming the common property, there was no permit issued. I do not agree with that suggestion. Where multiple occupancy permits are issued, they relate to the building work undertaken, not the ownership of the property[27] It is not a requirement of the Building Act, nor is it common practice, that they are based on ownership: that is, for common property as distinct from privately owned lots. There is no evidence that the relevant building surveyor for this project departed from the Building Act or usual practice and required a separate occupancy permit for the common property (other than the basement). The applicant has located occupancy permits for the various units and the basement and tendered those she considers relevant.[28] Accordingly, there is no evidence before me to cause me to conclude that the building surveyor departed from the operation of s21 of the Building Act.

81. Accordingly, I agree with the respondent's concession that time under s134 commenced to run from the date of the Occupancy Permit for unit 2, namely 11 March 2009. As the defect was not identified until July 2019, and the claim not purportedly made until the September APOC, it is out of time.

82. Second, if I am wrong about this and no Occupancy Permit for this part of the common property was issued, then the applicant is nevertheless out of time, as the limitation period would be 6 years from the date on which the cause of action accrued: Gledhill and Mason. As with the basement claim, whether the claim for the fire separation issues was made in the Original Claim, or the April APOC or the September APOC, it is significantly later than six years from the date of the building contract.

83. Third, for the reasons given in relation to the bathroom claim and the basement claim, I am satisfied that the fire separation claim is a new claim and goes beyond merely a re-characterisation of the Original Claim. The amendment in the September APOC goes further than "seeking a different legal conclusion based upon facts already in issue in the proceeding" (per Brirek) or "adding or vary a few minor details and to give the existing claim a new characterisation, closely akin and by no means remote from the subject matter of the original claim" (per Agtrack) or being a change to "the [legal] basis of the claim" when "the cost of rectification of alleged defective building work" had already been claimed (per May). The amendment to claim a new head of loss and damage, unrelated to anything else previously claimed, is not a true amendment of the Original Claim, but instead is a substitution of a new claim which takes effect only at the date of the amendment.

84. Fourth, insofar as the applicant alleges the respondent would not be prejudiced if the amendment were allowed, I reject the submission for the reasons set out at paragraphs 58-59 above.

85. Fifth, I do not agree with the applicant's characterisation of the orders made by Senior Member Vassie on 24 March 2021. As set out at paragraph 2 above, while he gave the applicant leave to prosecute the proceeding on behalf of the Owners Corporation, he expressly did not decide the respondent's application that the claim would be out of time.

86. Accordingly the claim in relation to the fire separation issues brought on behalf of the Owners Corporation and/or the applicant is struck out. Again, as the claim has not been individually pleaded, I will leave it to the parties to work out which parts of which documents should be struck out.

87. I order that the applicant's claims relating to the bathrooms and powder room, and the applicant's claims brought on behalf of the Owners Corporation relating to the basement carpark and the fire separation issues are struck out. If the parties cannot agree on which parts of which documents should be struck out, the applicant must file and serve her proposed Further Amended Points of Claim prior to the next directions hearing.

88. The proceeding will be listed for a direction hearing for the purpose of making orders for the future conduct of the proceeding. The parties are invited to provide proposed consent orders prior to the directions hearing.

89. The costs of this application are reserved. If any application for costs is made before the next directions hearing, further orders may be made in chambers or at the directions hearing.

[1] [2021] VCAT 233.

[3] [2021] VSC 338.

[4] Fancourt v Mercantile Credits Pty Ltd (1983) HCA 25; (1983) 154 CLR 87 at [27].

[5] [2019] VCAT 422; followed in Fraser v Mason (2019) VCAT 1009 and approved on appeal in Mason v Fraser [2021] VSC 461 at [43] ('Mason').

[6] Applicant's Submission 10 August 2021 paragraph 6.

[7] Applicant's Submission 10 August 2021 paragraph 4.

[8] To avoid any doubt, I note that the Tribunal (or a Court) has no power to extend the time limit set by s134 of the Building Act. The question of prejudice is raised by the applicant only in the context of the relation back principles.

[9] Affidavit of Suzanne Rieschieck sworn 1 April 2021.

[12] [2014] VSCA 165 at [189] - [204]

[13] [2003] VSCA 6.

[14] [2016] VCAT 399.

[15] Applicant's document 'Back Ground of amended Claim' dated 30 April 2019.

[16] Affidavit of Paul Richards sworn 26 August 2021 paragraph 10.

[17] Applicant's submissions paragraph 5.

[18] Respondent's submissions paragraph 15.

[19] Wintle v Conaust (Vic) Pty Ltd [2001] VSC 315; Pentridge Village Pty Ltd (In liq) v Capital Finance Australia Pty Ltd (2020) VSC 284 at [27].

[20] Affidavit of Paul Richards dated 26 August 2021.

[21] September APOC paragraphs 7, 9, 13, 10 [sic - should be 14].

[22] Simply Structural Engineers Pty Ltd report dated 12 August 2019 at paragraph 6.02.

[24] Exhibited to affidavit of Tania de Vincentis sworn 6 August 2021.

[25] Applicant's Submission 10 August 2021 paragraphs 14-16.

[26] Mason v Fraser [2021] VSC 461 at [37].

[27] See s21 Building Act and the discussion in Lendlease at [27]-[33]; [51]-[59].

[28] Applicant's Submission 10 August 2021 paragraph 6c.