Australia, July 10 -- New South Wales Land and Environment Court issued text of the following judgement on June 11:

1. This is an internal appeal from a decision of the Tribunal made on 29 August 2024 in the Consumer and Commercial Division.

2. On 22 September 2016, the respondents to the appeal ("the Homeowners") made a contract ("the Contract") with the appellant ("the Builder") to perform residential building work, in the form of renovations and additions to the Homeowners' dwelling. On 26 February 2019, the Homeowners terminated the Contract with the Builder for the Builder's delay in completing the works the subject of the Contract. The Homeowners then made a contract with another builder and completed the works the subject of the Contract. The other builder also performed some additional residential building work for the Homeowners that had not been the subject of the Contract.

3. On 15 February 2019 the Homeowners commenced proceedings in the Tribunal against the Builder. The Home Building Act 1989 (NSW) provided the Tribunal with jurisdiction to determine the Homeowners' claim.

4. On 8 July 2020, a Senior Member of the Tribunal awarded $317,919.00 in damages to the Homeowners for breach of contract.

5. The Builder appealed against the Tribunal's decision. On 21 September 2021, the Appeal Panel dismissed the Builder's Appeal but varied the award of damages payable to the Homeowners by increasing the award to $389,184.00.

6. The Builder appealed to the Supreme Court of New South Wales against the Appeal Panel decision. On 5 September 2022, the Supreme Court allowed the Builder's appeal. The basis of the Court's decision was that the Tribunal at first instance had conducted the hearing in a manner that was procedurally unfair to the Builder, in that the Senior Member who had conducted the hearing engaged in conduct that constituted apprehended bias.

7. The Supreme Court remitted the dispute between the Homeowners and the Builder to the Tribunal. The dispute was heard by the Tribunal on 16 and 17 October 2023, with written submissions filed afterwards. The Senior Member who conducted the hearing was not the same Senior Member who had made the orders on 8 July 2020 that are referred to above in these reasons. On 29 August 2024, the Tribunal ordered the Builder to pay the Homeowners $416,508.40 and to pay the costs of the respondents. It is this decision of the Tribunal that is the subject of this appeal.

8. By notice of appeal filed on 25 September 2024, the Builder seeks to set aside the orders of the Tribunal made on 29 August 2024. The Builder seeks an order that the appellant pay the respondents $102,609.00, in lieu of the order that it pay the respondents $416,508.40. The Builder seeks an order that the Homeowners pay its costs of the appeal proceedings.

9. The three principal issues considered in this appeal were whether:

10. the Tribunal had erred when ascertaining the Homeowner's damages by not applying clause 25 in the Contract. Clause 25 dealt with termination of the Contract by the Homeowner due to the fault of the Builder. The proper application of clause 25 in the Contract, and the words therein "that which would otherwise have been due under the contract" contained in clause 25 in the Contract, required, so the appellant submitted, the adjustment of the contract price in the Contract, not only to allow for variations, but also to allow for provisional sum and prime cost items including such items supplied and installed by the other builder who completed the works the subject of the Contract following the Contract's termination;

*Rest of the document can be viewed at: (https://www.caselaw.nsw.gov.au/decision/197428a0fcee9882b2032e10)

Disclaimer: Curated by HT Syndication.